Telkomunikasi Indonesia Joins Bid for Burmese Market

By Tito Summa Siahaan 1 March 2013

JAKARTA — Telkomunikasi Indonesia, the largest telecommunications service provider in the country, has joined a bid to seek investment opportunities in Burma.

Indra Utoyo, the company’s strategic portfolio director, said in Jakarta on Thursday that the company is participating in a tender to acquire a license for a mobile operator in Burma.

The Burmese government announced invitations for expressions of interest for mobile phone licenses in January.

Indra said that Telkomunikasi Indonesia, also known as Telkom, has officially declared its interests to acquire the license from the Burmese government.

“We see Myanmar as having great potential, as the mobile penetration rate currently only stands at 5 percent,” Indra said at a conference held by the Economist magazine in Jakarta.

However, Indra refused to speculate on the chances that Telkom will acquire the license, saying the Burmese government had set high standards for applicants.

“They require the interested parties to have a large consumer-base outside their home country,” he said.

Telkom joins rival companies SingTel, Telenor, Axiata, ST Telemedia and Bharti Airtel in the bid, as reported by Dow Jones last week.

Muhammad Awaluddin, Telkom’s director for enterprise and wholesale, said on Feb. 12 that the company aims to boost its overseas business and estimates a 4 percent increase in revenue this year.

The Bandung-based telecom operator expects its revenue to increase to 80 trillion rupiah (US $8.3 billion), Awaluddin said.

The company also has plans to expand its international coverage with services in Macau, Taiwan and South Korea, Awaluddin said, declining to comment on the company’s revenue targets for the new markets.

Telkom is planning massive investments this year, spending 20 trillion rupiah to expand its business in Indonesia and abroad, with bank loans financing the expansion.

Telkom has several units including Telkomsel—Indonesia’s largest mobile phone operator with 125 million subscribers—and Telekomunikasi Indonesia International (Telin), an international carrier service that focuses on strategic investment in the international telecommunications business. Telin manages AriaWest International Finance in Amsterdam, which focuses on finance, as well as subsidiaries in Singapore and Hong Kong.

Telin owns a 29.7 percent stake in Scicom Malaysia, the largest contact center for outsourcing service providers in Malaysia.