ISD Coffee Talk: The International Best Practice on Telecommunication Network Sharing

Jakarta, 2 September 2016

ISD Coffee Talk: The International Best Practice on Telecommunication Network Sharing

Jakarta, September 2 2016. Network sharing in the telecommunication sector can be an important mechanism to save costs and improve efficiency in the delivery of telecommunication services. As such, it is used by many countries to drive digital connectivity, increase access to telecommunication services, and reduce the digital divide. Network sharing can thus play an important role in reducing telecommunications infrastructure costs and improving access to telecommunications services, including broadband services, in the remote parts of Indonesia.

Many parties believe that network sharing will help the Government to accelerate the implementation of national development. At the same time, in promoting network sharing the Government needs to acknowledge the rights of the infrastructure owners or developers and ensure that access to such infrastructures is facilitated by a fair and transparent regulatory framework.

“Realizing the importance and the huge impact of telecommunication services toward the people, ISD is committed to provide a productive dialogue forum for regulator, business sector, and academician in figuring out the best practice in telecommunication network sharing. Discussion about network sharing is very relevant as most of mass media in Indonesia capture this as a public affair,” said Taufikurrahman, ISD Executive Director, in the welcoming remarks of ISD Coffee Talk: The International Best Practice on Telecommunication Network Sharing.

“Network sharing is a nature in ICT industry. If network sharing could promote more competitiveness and benefit the users, then this should be taken. We realize, if supply of network is dominated by one operator, the market tend to be monopolistic,” emphasized Basuki Yusuf Iskandar, Head of R&D and Human Resource Development, the Ministry of Communication and Informatics Republic of Indonesia, in his opening remarks.

According to Basuki Yusuf Iskandar, network sharing consists of several network-related schemes. There are at least five schemes that telecommunication operators could look into. They are site sharing, mast sharing, Radio Access Network (RAN) sharing, core network sharing, and network roaming.

In the presentation session, Thomas Chevanne, Chief Strategy & Experience Officer Indosat Ooredoo (ISD Board of Founders), mentioned that the most expensive cost for telecommunication operator is maintaining the network. This is the main reason why network sharing should be implemented. He noted that network sharing is not an utopia since the practice has been taken by some of telecommunications operators in Indonesia such as Indosat Ooredoo and XL Axiata.

“Network sharing is already happened in Indonesia. We only need to make it happen in a more efficient way. Most of government agencies want network sharing to happen because it will open up competition and make cost going down. If this is not happening, we are letting monopolistic system exist in most of rural areas in Indonesia,” added Thomas Chevanne.

In terms of national regulation in Indonesia, Allan Asher, Senior Consultant of UNCTAD & Chairman of the Foundation for Effective Markets and Governance (FEMAG), presented that revision of the Government Regulation 52/2000 on Operations of Telecommunications and Government Regulation 53/2000 on Utilisation of Radio Frequency Spectrum and Satellite Orbit, which will be strengthened as the legal standing for network sharing, are under a heated discussion. In Allan Asher’s opinion, network-sharing scheme will be difficult to achieve as long as there is still an imbalance competition among telecommunication operators in Indonesia.

“The fact that one telecommunication operator dominates over 80% of market share outside Java Island makes the network-sharing issue unpopular,” said Allan Asher.