Workers maintain a telecommunication tower in Batam, Riau Island on Oct, 17, 2021. (Antara Photo/Joko Sulistyo)

Mitratel Sets Aside $69m for Building Telco Towers in Remote Areas

BY :JAKARTA GLOBE

FEBRUARY 24, 2022

Jakarta. Dayamitra Telekomunikasi, or Mitratel, Indonesia's largest telecommunication tower operator, has set aside $69.5 million for building telecommunication towers in underdeveloped, frontier, and outermost areas across Indonesia, taking its part in the government's drive to connect all the country's population to the broadband internet network. 

Hendra Purnama, the investment director of Dayamitra Telekomunikasi, said the company would spend the Rp 1 trillion ($69.5 million) budget over the next four years. The budget would also be outside the company's annual capital expenditure, which reached Rp 9.9 trillion this year. 

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"Our estimation is it would need Rp 1 trillion because not every tower needs  Rp 1 billion to build," Hendra told the Globe's sister publication Investor Daily on Wednesday.

Hendra said that the funds came from the initial public offering (IPO) conducted in November last year. The tower construction is Mitratel's support for distributing telecommunications networks to all corners of the country and accelerating Indonesia's digital economy growth.

Indonesia expects to provide all of its population with broadband internet connection. To do so, it requires telecommunication companies to expand to remote areas. Still, the companies remained reluctant to expand to remote areas due to a lack of commercial returns. 

Therefore, through the Telecommunication and Information Accessibility Agency (Bakti), an telecommunication infrastructure arm under the Communication and Information Technology Ministry, the government also builds towers in remote areas using a cooperation scheme with the telecommunication companies.

Under the scheme, Bakti is responsible for constructing and maintaining the towers. Local governments are to provide the lands. The telecommunication companies will only be responsible for operating and maintaining 4G services using towers built by Bakti on the local governments' grounds. 

For the 2021-2022 period, Bakti is building 7,904 telecommunication towers out of 9,113 towers that the government required it to make, the ministry said in a statement last month. 

 

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