A technician from mobile operator XL Axiata inspects a base transceiver station on a telecommunication tower in Labuhan Badas, West Nusa Tenggara, last year. (Antara Photo/Reno Esnir)

Telcos Demand Gov't Relief as Pandemic Sheds Revenues From Corporate Customers

BY :ABDUL MUSLIM

APRIL 16, 2020

Jakarta. As working from home quickly becomes a new norm during the coronavirus pandemic and Indonesians burn through their internet bandwidth, telecommunication companies and internet providers on paper should be raking it in. But that could not be further from the truth. 

The Telecommunications Network Providers Association (Apjatel) has recently asked the government to suspend or reschedule payments of the telecommunication rights fee (BHP) and the universal service obligation fee for the 2019 fiscal year, which are due this month. 

Apjatel chairman Muhammad Arif said association members were losing income from their corporate clients and are struggling to come up with enough cash to maintain operation.  

"With work from home policy in place, almost all offices are empty, which causes a significant fall in internet traffic, around 60 percent, from normal conditions," Arif said. 

"Many corporate customers have canceled their subscriptions or asked for monthly fee waivers from the network operators," he said. 

Many corporate customers have also been guilty of late payments as they struggle to deal with the domino effect of the Covid-19 outbreak.

Arif also pointed out there was virtually zero growth of new customers at this time.  

Apjatel members include fiber-optic network operators which support mobile phone operators, internet service providers and content service providers across Indonesia.

They include Link Net, Indosat and Tower Bersama. 

Arif acknowledged an increase in demand from retail customers, but according to him, that has not translated to an increase in revenue for the companies. 

"[In fact,] the traffic growth from retail customers means we have to upgrade our services and that will have an impact on production costs," Arif said.

Meanwhile, the government has asked the Apjatel members to support the government's work from home policy to try to limit the spread of the coronavirus. 

"What we're doing now is providing free upgrade services. Our revenue remains steady, but our costs have increased," Arif said. 

Arif said the association had submitted a request for the government relief to the Communication and Information Technology Ministry.

A 2018 Law on Non-Tax State Revenue allows such a relief to be given under certain conditions, including a disaster. 

President Joko "Jokowi" Widodo has declared the Covid-19 pandemic as a national disaster.

Jakarta and its satellite cities Bogor, Bekasi and Depok in West Java have imposed large-scale social restriction which comes with a ban on working from offices except in a few essential sectors. 

 

 

 

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