- 37 - Pursuant to MoCI Decree No.432007, we opened our network to the “01X” three-digit DLD access service in Balikpapan by
On December 16, 2008, the MoCI issued an in-principle DLD license to Bakrie Telecom, increasing the number of potential DLD operators to three. However, as of the date of filing of this annual report, Bakrie Telecom has not yet obtained a DLD
operating license which would require them to first procure necessary DLD infrastructure.
Our DLD tariffs are regulated by MoCI Regulation No.15PERM.KOMINFO42008 dated April 30, 2008 regarding Tariff Calculation Procedures for Basic Telephony Services on Fixed Wireline Networks “MoCI Regulation No.152008”, limits our
interconnection tariffs in accordance to a specified cost-based formula. MoCI Regulation No.152008 also provides that our tariff structure be comprised of a connection fee, monthly charges, usage charges
and additional facilities fees. We are required by MoCI Regulation No.152008 to report our cost-based tariff calculation to the ITRA.
F.
IDD Services
We received our IDD license in May 2004 and began offering IDD fixed line services to customers in June 2004 using the “007” IDD access code. The Indosat IDD access code is “001”. Our December 2005 interconnection agreement with Indosat enables
Indosat’s network customers to access our IDD services by dialing “007” and our network customers to access Indosat’s IDD services by dialing “001”.
On February 12, 2009, the MoCI issued a fixed IDD license to Bakrie Telecom, with international access code “009”, which has increased the number of potential IDD operators to three.
Interconnection fees from international network providers to local network providers are determined based on the interconnection offering document for fixed line local network providers. Our fixed line IDD tariff are regulated by MoCI Regulation
No.152008 in the same manner as our fixed line DLD services.
G. Limited Mobility Wireless Services
MoC Decree No.KM.352004 dated March 11, 2004 regarding Implementation of Fixed Wireless Networks with Limited Mobility, as amended by MoCI Decree No.16PERM.KOMINFO062011 dated June 27, 2011,
“MoC Decree No.KM.352004” provides that only local fixed network operators holding licenses issued by the MoC may offer limited
mobility wireless or fixed wireless access services. In addition, MoC Decree No.352004 states that each limited mobility wireless access operator must provide basic telephone services. Under an automated migration feature, customers are able to
make and receive calls on their fixed limited mobility wireless access phones using a different number with a different area code.
Indosat, Bakrie Telecom and Mobile-8 also hold limited mobility wireless operating licenses. Our fixed wireless tariff are regulated by MoCI Regulation No.152008 in the same manner as our DLD and IDD fixed line
services.
H. Cellular
Cellular telephone service is provided in Indonesia on the radio frequency spectrum of 1.8 GHz DCS technology, 2.1 GHz UMTS technology and 900 MHz GSM and UMTS technology. The MoCI regulates the use and allocation of the radio
frequency spectrum for mobile cellular networks. Telkomsel has obtained frequency allocation for cellular services on the 900 MHz, 1.8 GHz and 2.1 GHz frequency bands. The Government conducted tenders for the allocation of the 2.1 GHz radio
frequency spectrum, and allocated bandwidth, in 2006, the Government allocates through the tender prosess for allocation at 5 MHz, while for the allocation of additional radio spectrum allocated through an evaluation mechanism was in 2009 and a
selection in 2013. The allocation of bandwidth in the 2.1 GHz frequency spectrum is regulated by:
MoCI Decree No.19KEPM.KOMINFO22006 dated February 14, 2006 regarding the Determination of Winner of IMT-
2000 Mobile Cellular Operator Selection at 2.1 GHz Radio Frequency Band;
MoCI Decree No.268KEPM.KOMINFO92009 regarding the Determination of Additional Allocation of Radio Frequency Bandwidth Blocks, Tariffs, and Payment Scheme Radio Frequency Spectrum Right of Usage Fees for IMT-2000 Mobile
Cellular Operators at 2.1 GHz Radio Frequency Band; and
MoCI Decree No.191 Year 2013 regarding the Determination of PT Telekomunikasi Selular as Winner in the Selection of Users of Additional Frequency Bandwidth at 2.1 GHz Radio Frequency Band for IMT-2000 Mobile Cellular Operators.
- 38 - I.
Interconnection
The Telecommunications Law expressly prohibits monopolistic and unfair business practices and requires network providers to allow users to access other users or obtain services from other networks by paying interconnection fees agreed upon by each
network operator. Government Regulation No.522000 dated July 11, 2000 regarding Telecommunications Operations provides that interconnection charges between two or more network operators must be transparent, mutually agreed upon and fair.
On February 8, 2006, the MoCI issued Regulation No.8PERM.KOMINFO022006 on Interconnection “MoCI Regulation No.82006”, mandated a cost-based interconnection tariff scheme for all network and services operators replacing the previous
revenue-sharing scheme. Under the new scheme, interconnection charges are determined by the network operator on which a call terminates based on a long-run incremental cost formula provided under MoCI Regulation No.82006.
MoCI Regulation No.82006 requires operators to submit to the ITRA annual RIO proposals containing proposed interconnection tariffs for the coming year. Operators are required to use the cost-based methodology in preparing RIO proposals, and the ITRA
and MoCI are required to use the same methodology in evaluating the RIO proposals and approving interconnection tariffs. The RIO proposals also include call scenarios, traffic routing, point of interconnection, procedure for requesting and providing
interconnection, and other matters. RIOs must also disclose the type of interconnection services offered and tariffs charged for each service offered. Interconnection access providers are required to implement a queuing system on a First-in-First-Serve basis.
Additionally, network interconnection must be implemented in a transparent and without discrimination.
Pursuant to MoCI Regulation No.82006 and ITRA Letter No.246BRTIVIII2007 dated August 6, 2007, we submitted a RIO proposal to the ITRA in October 2007, which covered adjustments for operational, configuration, technical and service offerings.
In December 2007, we and all other network operators signed new interconnection agreements that superseded previous interconnection agreements between us and other network operators which also amended all interconnection agreements signed in
December 2006. These agreements temporarily served in lieu of RIOs while the ITRA continued to review the RIO proposals received from ourselves and other operators.
On February 5, 2008, the ITRA required that we and other operators begin implementing the cost-based interconnection tariff regime. On April 11, 2008, pursuant to Directorate General of Post and Telecommunication “DGPT” Decree No.2052008, the
ITRA and the MoCI approved RIO proposals from all operators to replace previous interconnection agreements. The RIO approved in 2008 was effective until July 29, 2011 when new interconnection charges were implemented as stipulated in ITRA
Letter No.227BRTIXII2010 dated December 31, 2010 regarding the Implementation of Interconnection Charges in 2011. This is the result of interconnection charges recalculation conducted in 2010 by MoCI that was agreed on by all operators and outlined
in a Memorandum of Understanding. In this process, we were appointed as a default data source for the calculation of fixed wireline and fixed local interconnection tariffs. Our subsidiary, Telkomsel, and Indosat were similary appointed as the default
data source for the calculation cellular interconection tariffs. Meanwhile, Indosat data is positioned as a benchmark for calculating the cost of cellular mobile network interconnection. The results of this interconnection charges reform caused a slight decrease
in interconnection costs.
On December 12, 2011, the ITRA changed the SMS interconnection fee basis from a “Sender Keep All” basis to a cost basis interconnection fee calculation which required certain amendments to RIOs agreed upon in 2011. MoCI Regulation No.82006
stipulates that the RIO of telecommunications network operators generating operating revenue that is equal to or more than 25 of the combined revenues of all telecommunication operators that serve the same respective segment, must obtain ITRA’s
approval, necessitating changes in our and Telkomsel’s RIOs which were approved on June 20, 2012. In 2012, we and Telkomsel were confirmed as telecommunication network operators that are capable of posting revenue of 25 or more of total
operating revenues of all telecommunication operators combined in the respective segments in 2012, through the Decree of the Director General of PPI No.181AKEPDJPPIKOMINFO52012 dated May 16, 2012. Until this report is published, no
recalculation of interconnection fees for 2012 had been done as doing such should have been preceded by an evaluation on interconnection charges in 2011.
J. VoIP
