Telkom Indonesia Business Update: Rational Pricing Strategy for Business Sustainability

JAKARTA, Indonesia, Dec. 3, 2019 /PRNewswire/ -- Throughout 2019, PT Telkom Indonesia (Persero) Tbk (Telkom Indonesia) has been consistently providing the best services for its consumers and continues to be the market leader. "The ability of Telkomsel and IndiHome to lead the market shows public confidence in TelkomGroup's service quality," said Telkom Indonesia Finance Director Harry M. Zen.

In the cellular segment, simultaneous network development throughout the archipelago has generated 171 million customers, out of which 112 million are mobile broadband users. Revenues from mobile broadband in the first nine months of 2019 grew by 28.4% compared to September 2018 to Rp9.1 trillion, driven by a surge in service traffic by 55.2%.

Mobile broadband services will still be Telkomsel's engine of growth in the future, considering the low average consumption of data users, which stands roughly 5 to 6 GB per month compared to that in neighboring countries at more than 10 GB per month. Data traffic grows in accordance to the changes in people's lifestyles with the proliferated use of social media, video services, music, games, and migration of 2G users to 3G and 4G services. Along with this transition, legacy services will be diminishing and be gradually replaced by data services.

In addition to that, Telkomsel seeks to strengthen its position in the millennial segment, which will be high-value customers in the future. Harry said, "Telkomsel offers wide-ranging services with the highest quality with a rational pricing strategy with a more-for-more concept, so that profitability is maintained. This is important to make sure we can reinvest and to secure business continuity in the future."

Another Telkom Indonesia's engine of growth, IndiHome, continue to record significant growth. As per September 2019, IndiHome already has 6.5 million customers with Rp13.7 trillion revenue or grew 52.1% compared to the same period in 2018. This was made possible due to various innovations and development in services that the company offers to customers. At the end of the third quarter, there are 4.5 million add-ons that customers subscribe to. IndiHome also offers various bandwidith options up to 200 Mbps and 300 Mbps for residential subscribers. IndiHome also offers IndiBox, or an over the top (OTT) that uses access to internet for Android TV Box/Smart Box-based IndiHome subscribers. Moreover, IndiHome offers a more comprehensive new service such as Ruang Trampil, or an edutainment channel featuring tutorials and self-learning from experts on each certain topics; gameQoo, which enables IndiHome gamer subscribers to play games on TV without having to download the game. This wide-reaching IndiHome service available in various sub districts is available with affordable price so that it is more accessible for various segments of the public.

Meanwhile in the Enterprise and Wholesale segment, Telkom remains focus on providing a service that contributes with good profitabilty.

Harry added that apart from focusing on its quality of service, Telkom Indonesia also applies rational pricing and maintain its profitability. This is made possible by focusing on the changes of performance, effective management cost, so that it is able to book a profit. "In the existing competitive situation and based with a historically-high performance, we continue to record a positive growth. Amongst the other players in the telecommunications industry, Telkom Indonesia is a company that remains capable to generate profit and regularly disburse dividends to its shareholders. In 2019, we have set a target to get a much higher margin compared to last year," Harry said.

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Source: PT Telkom Indonesia (Persero) Tbk
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