Telkomsel: Paling Indonesia

Telkomsel is the largest subsidiary of Telkom Group and a mobile phone network operator in Indonesia. Telkomsel currently has one of the widest networks in Indonesia, covering more than 97% of Indonesia. Telkomsel provides subscribers with prepaid and post-paid services as well as a variety of value-added services. Recently, ZTE Technologies interviewed Bona Lambok Pandapotan Parapat, EVP of Pamasuka Area of Telkomsel, and Ivan Cahya Permana, vice president of technology and systems at Telkomsel. They talked about Telkomsel’s LTE services, 5G plan, networking strategies, advantages and challenges in Indonesia. They also shared with us their visions for Telkomsel and expectations for the future cooperation between Telkomsel and ZTE.

Bona Lambok Pandapotan Parapat

Q: Could you talk about your role and responsibilities in Telkomsel?

A: I am the EVP of Pamasuka Area of Telkomsel, heading the regional office covering Kalimantan, Sulawesi, Maluku and Papua operational area.

Q: What are the unique characteristics of Indonesian telecom market? What’s the meaning of your slogan "Paling Indonesia"?

A: The Indonesian telecom market mostly comprises mobile services used by about 280 million subscribers. More than 95% of these subscribers are prepaid and around 50% are data users. Although traditional SMS has been overtaken by OTT applications, the volume of SMS is still quite high and contributes to around 30% of our revenue.

Paling Indonesia is a slogan used by Telkomsel which indicates that compared to other telco operators, we care the most to build Indonesia. It is also because the shareholders majority is still owned by Indonesians.

Q: What have been the key challenges in O&M?

A: The key challenges are still to find more efficient solutions in transmission system and power supply to manage our operational cost to cover a vast area.

Q: Many operators are rushing towards LTE and seizing the opportunities for further growth. What is your plan for deploying LTE?

A: Telkomsel has already implemented LTE in five big cities in the first half of 2015, and we will continue to modernize our network so that it is LTE capable in all the big cities.

Q: Could you introduce to us some innovative services that Telkomsel delivered in Indonesia?

A: For legacy and data services we have introduced several attractive packages to our customers to cater to their needs, either individually or by Close User Group.

For digital services we have launched digital payment, digital advertising, on- line game, etc and even build a platform for local developers to build their own apps.

Q: What are your main goals in the next five years and how to achieve them?

A: Telkomsel as the largest subsidiary of Telkom Group would like to ensure that we will be the market leaders in digital services, both in terms of market share and revenue share.

Telkomsel will continue to improve its competence in creating attractive digital services and at the same time improve its network capability.

Q: Telkomsel and ZTE have worked together on both 2G and 3G projects in Indonesia. How do you rate the partnership between Telkomsel and ZTE? What are your expectations for ZTE in future?

A: It was not an easy journey for ZTE to take part in Telkomsel business at the beginning. But through its commitment to be one of the respectable partners, ZTE has shown its quality in its deliverables to Telkomsel, and I do hope ZTE continues to show its top performance and grow its business together with us.

Q: What are your thoughts on the future trends in the global telecom market?

A: There will be heavy competition between OTT players and mobile operators. Both sides will drive the unlimited demand of bandwidth for which new solutions have to be in place. The solutions provide very high capacity in both radio network and transport systems. Much more advanced smartphones will connect mobile users using primarily digital services.

Ivan Cahya Permana

Q: Could you describe the Indonesian telecom market?

A: It is already saturated in term of individual subscribers. We’re also facing huge challenges from OTT players, exponential traffic data growth, pricing competition and high customer expectations on service quality. There are more than ten operators competing in Indonesia, and this has led to an unhealthy telecom industry. Thus, the government has streamlined the industry by promoting consolidation between operators.

Q: In a market as competitive as Indonesia, what are your advantages?

A: Our vast network is still our main advantage. Indonesia is the largest archipelago in the world, scattered over an area greater than China and second only to Russia. It takes a lot of effort to provide network coverage to all the parts of Indonesia. Many operators don’t have the capabilities to do that.

Q: NFV and SDN are big trends. How will NFV and SDN influence your networking strategy?

A: Telkomsel sees NFV and SDN as the new promising technologies because they increase TCO efficiency, make the network more flexible, and shorten time to market. However, there are several things that need to be considered: standardization, maturity of the technology, interoperability, and carrier-grade performance. When these aspects are further developed, we believe NFV and SDN will enable an agile and sustainable networking strategy for Telkomsel.

Q: As everyone moves into LTE, how will Telkomsel position its LTE services? Will LTE be Telkomsel’s key focus to promote future growth?

A: No doubt the future will be LTE, but our near future will still depend on 3G as the major growth engine. We predict by 2019 most of Telkomsel’s subscriber base will still be using 3G, and the number of 4G subscribers will be relatively small.

Q: 5G is expected to be available in 2020. Do you think Telkomsel will be ready for 5G at that time?

A: For sure, as a leading operator in the nation, Telkomsel will try its best to serve customers with the most up-to-date technology, including 5G. Technically speaking, we believe Telkomsel will not have any problems deploying 5G by 2020. However, all of the decisions will be driven by overall ecosystem readiness and business requirements.

Q: What is Telkomsel’s marketing strategy to increase ARPU and the subscriber base?

A: Mobile data and a diverse portfolio of digital products and services will be our strategy for increasing ARPU. We’re also counting on IoT to significantly increase our subscriber base.

Q: Many operators are transitioning from products to services. Have you taken any steps towards such transformation?

A: Digital company transformation will be our next corporate objective strategy. It will lay the foundation for our company on how we should provide a diverse portfolio of digital products and services, which need to be driven by consumer requirements and tailored to customer needs.

Q: How have ZTE’s services and solutions brought value to Telkomsel?

A: ZTE’s experienced teams have collaborated with Telkomsel. ZTE also provides innovative, customized solutions to comply with the requirement in Telkomsel network. In the future, we hope that Telkomsel and ZTE can improve the collaboration and partnership to achieve the mutual benefit.

Q: What is your vision for Telkomsel?

A: Our vision is to be a world-class, trusted provider of mobile digital lifestyle services and solutions. We hope Telkomsel will be the epicenter of digital innovation and the accelerator for Indonesian’s economic growth.

Q: What is your strategy or focus for the next three years?