About PT Indosat Ooredoo Hutchison Tbk

PT Indosat Tbk provides a complement of national and international telecommunications services, including cellular services and international long-distance services in Indonesia. The company also provides fixed data services, which include multimedia, data communications, and Internet (MIDI) services for domestic and regional corporate and wholesale customers, as well as domestic retail customers. As of December 31, 2013, the company’s postpaid cellular subscribers could roam internationally in 190 countries. In addition, for its international long-distance services, it maintained direct connections with foreign telecommunications operators in 32 countries. The company offers international calling services to Iran and to Cuba, Sudan, and Syria. There are roaming arrangements between its company and each of Mobile Company of Iran (MCI), C Com, Syriatel Mobile Telecom SA (Syriatel) and Sudanese Mobile Telephone Co. (Mobitel) for Iran, Cuba, Syria and Sudan, respectively. Products and Services The company’s principal products and services include cellular services, MIDI services, and fixed telecommunications (voice) services. CELLULAR SERVICES The company provided global system for mobile communications (GSM) 900 and 1800 and third generation (3G) cellular services to approximately 59.6 million cellular subscribers (including wireless broadband subscribers) throughout Indonesia as of December 31, 2013. The company’s cellular network provides network coverage in all major cities and centers across Indonesia. It also provides prepaid and postpaid wireless broadband services in Indonesia. Services The company’s principal cellular services are the provision of voice and data services, which the company sells through postpaid and prepaid plans. The company’s prepaid and postpaid subscribers are able to make and receive on-net voice calls to and from other Indosat subscribers (including its Matrix, Mentari and IM3 subscribers) on its telecommunication network, as well as off-net voice calls to and from subscribers of other telecommunication operators on their fixed and cellular telecommunication networks. The company offers prepaid cellular service plans under the IM3 and Mentari, brand names. The company’s Mentari brand is marketed towards a more mature market, professional and corporate users, especially the smart phone users, offering integrated packages comprising voice, SMS, and data services and providing subscribers with packages suitable for their smart phones. The company offers postpaid plans, designed for high-end professional and corporate users, under the Matrix brand name. In addition, the company offers various value-added services, functions and features to its subscribers. Such services, functions and features, which, in certain cases, are free of charge, can be purchased individually or bundled according to the package selected, include: SMS: allows subscribers to send short text messages to other cellular users’ mobile phone display screens; Mobile data and broadband services: allows subscribers to browse and download sports, news, horoscope, movies, music and finance content to their mobile handsets, connect to a computer as modem, send and receive using GPRS and 3G network for broadband quality; BlackBerry services: allows subscribers to register and use a full suite of BlackBerry services, including email, chat, browsing, GPS, and many other BlackBerry based applications; MMS: allows subscribers of GSM service to send pictures, text and sound/voice in a single packet message; Voice SMS: allows subscribers to send audible messages; Ring-back tone: allows subscribers to choose their favorite song as the ringtone that is heard by callers for incoming calls; GPRS: provides mobile data communications with GSM-based technology, including mobile Internet, data transfer and push e-mail (BlackBerry services); Facsimile services: allows subscribers to send and receive faxes; Voicemail: enables callers to leave voice messages that can be retrieved by subscribers; Caller identification: displays the incoming call number on a subscriber’s mobile phone display screen; Call holding: allows subscribers to place an incoming or outgoing call on hold while making or receiving other calls; Call waiting: signals subscribers that they have an incoming call while the line is engaged. Upon hearing such a signal, subscribers can answer the second call and place the original call on hold; Call forwarding: enables subscribers to forward incoming calls to other cellular or fixed-line numbers; Detailed billing: provides subscribers with detailed billing statements indicating the duration and cost of calls made to and from a particular mobile phone; Direct debit payment: provides a payment option that automatically deducts billed amounts from the subscriber’s bank account or credit card; Recharge via SMS and automated teller machines: enables subscribers to recharge their prepaid airtime plans via SMS and automated teller machines automatically deducting billed amounts from the subscriber’s bank account; and International roaming: allows prepaid and postpaid subscribers to send/receive SMS, voice and data (GPRS/3G) services while roaming on foreign cellular networks. Facsimile services, detailed billing and direct debit payments are only available to postpaid subscribers. The company offers certain services free of charge, including caller identification, call holding, call waiting and call forwarding, while others, such as SMS, mobile data, broadband, BlackBerry, facsimile services and detailed billing, carry additional fees. The company offers a VoIP Service, under the brand name ‘FlatCall 01016,’ aimed at its most price-sensitive customers. This service is only available to its cellular, fixed wireless and fixed line subscribers. The ‘FlatCall 01016’ service offers discounted tariff rates for certain top destination countries. The company provides its SMS service to prepaid and postpaid cellular subscribers. Usage levels have increased from an average of approximately 735 million text messages (excluding value-added service SMSs, such as SMSs related to promotions by content providers and advertisers) per day in 2012 to a daily average of approximately 750 million text messages (excluding value-added service SMSs) in 2013. The company offers international roaming services to its cellular subscribers to enable them to make and receive calls and to send and receive SMS text messages and use data services (on GPRS or 3G) when outside Indonesia. The company has entered into roaming agreements with operators of GSM cellular networks in Africa, Europe, North and South America and Asia. Mobile Data Services The company offers a portfolio of mobile data services. Mobile data services can be accessed through, among others, SMS, direct dial-up connection to a WAP server or wireless broadband, where subscribers can access various information, including movie listings, stock quotes, exchange rates, sports and business news and astrological predictions, and recharge their prepaid SMS cards. The company provides GPRS service with EDGE technology in most large cities in Java, Bali, Sumatra, Kalimantan, Sulawesi and Papua. The company has approximately 2.6 million BlackBerry subscribers as of December 31, 2013. In 2013, the company deployed ‘Indosat SuperWifi’ coverage at approximately 4,000 spots in certain main cities in Indonesia including Jakarta, Semarang, Denpasar and Surabaya. ‘Indosat SuperWifi’ adopted the Wi-Fi technology that allows its subscribers to access unlimited Internet data on handsets or tablets from ‘Indosat SuperWifi’ hotspots using its number with speeds of up to 20Mbps. Subscribers and Marketing The company conducts nationwide marketing and promotional activities, as well as regional or local campaigns, in an attempt to retain its existing valued cellular subscribers and to acquire new cellular subscribers. Interconnection The company interconnects with fixed line and cellular networks operated by all network operators at various locations throughout Indonesia. Activation, Billing and Collection The company bills its postpaid subscribers on a monthly basis through its centralized billing division. In the case of prepaid subscribers, the wireless billing system automatically reduces the value of each prepaid subscriber’s account as originating, transit and terminating charges are assessed. The company’s postpaid subscribers have various payment options in paying their monthly bills. Payments may be made by cash and major credit cards through Indosat galleries, bank tellers or post office branches. Competition The company’s main competitors for mobile broadband services are Telkomsel, and XL with its 3G Hotrod campaign. Other operators, such as Smartfren also provide mobile broadband service using EVDO-CDMA technology. MIDI Services The products and services that the company offers in this business segment include high-speed point-to-point international and domestic leased line with broadband and narrowband capacity, MPLS-based services, satellite transponder leasing, Internet services and IT services, such as disaster recovery center and data center services. The company launched Indosat Cloud Services with infrastructure-as-a-service. Indosat Cloud Services is provided via the Internet or private network in a scalable, package model built using industry hardware and software. Recognizing the significant growth potential of data and other network services, including Internet-based services, and their increasing importance to its overall business strategy, the company has placed considerable emphasis on this business segment. Services World Link, Direct Link and Domestic Link: World Link is an international private line circuit that provides international connection of high-speed digital data circuits on a point-to-point basis via submarine and terrestrial cables and offers line speeds from 64 Kbps and multiples thereof up to 2 Mbps for narrowband or 45 Mbps and above for broadband. Direct Link is a leased line service through satellite or VSAT connections which provides high-speed digital data circuits on point-to-multipoint basis and offers line speeds from 64 Kbps and multiples thereof up to 2 Mbps for narrowband. Domestic Link is a domestic private leased circuits service that provides high-speed digital data circuits on a point-to-point basis and offers line speeds from 64 Kbps and multiples thereof up to 2 Mbps for narrowband or 45 Mbps and above for broadband. Most of its broadband World Link customers are telecommunications providers who require dedicated broadband international data links, and its narrowband World Link customers consist primarily of corporate users who subscribe to its World Link service for their own internal use. Direct Link is used for international connections and other leased line users located in areas that are not covered by terrestrial domestic networks. The company’s broadband Domestic Link customers in the domestic market include telecommunications providers that need dedicated domestic broadband data links, and its narrowband Domestic Link customers mostly are corporate users who use the service for their own internal use. IP VPN: The company provides both international and domestic IP VPN services through Indosat, Lintasarta, and IM2, which provide customers with multi-point connectivity for data communication through its robust IP network cloud. MPLS and Metro Ethernet: MPLS and Metro Ethernet are domestic and international leased line services provided through its Internet Protocol network cloud. The company’s MPLS-based services consist of Premium Ethernet Point to Point, Premium Ethernet Multi Point, and IP VPN, and offer line speeds from 64 Kbps and multiples thereof up to 2 Mbps for narrowband or 45 Mbps and 155 Mbps for broadband. Metro Ethernet provides high-speed domestic inner-city bandwidth connections with line port speeds of 10 Mbps, 100 Mbps and 1 Gbps and an Ethernet base with an incremental guaranteed bandwidth of 1 Mbps. The company offers its various data connectivity services, including World Link, Direct Link, Domestic Link, IP VPN, MPLS and Metro Ethernet, to its various corporate customers, including multinational corporations, that are tailored to fit their specific information and telecommunications requirements, pricing parameters, speed requirements and security concerns. Satellite Services: The company leases transponder capacity on its Palapa-D satellite, which is positioned in an orbital slot located over the Asia-Pacific region, to broadcasters and telecommunications operators. Indonesia has a large television market in which a number of privately-owned domestic broadcasters and international programmers compete with the state-owned broadcaster and many of these domestic and international broadcasters lease capacity on its satellite. The company also provides various other satellite derivative services, including occasional use for TV services (including Indosat TV link, ‘Satellite News Gathering’ and transportable uplink station services), private network services, Internet access and multimedia and video conferencing. Internet Services: The company provides international IP transit services for ISPs via the Jakabare and SEA-ME-WE 3 (South East Asia Middle East Western Europe 3) cable systems and domestic IP transit via its MPLS backbone. Dedicated Internet access services for end users and corporate customers are delivered by Indosat, IM2 and Lintasarta. Lintasarta offers corporate subscribers dedicated Internet services under the ‘Lintasarta Dedicated Internet’ brand and broadband services under the ‘Lintasarta Broadband Service’ brand. VSAT Net/IP and VSAT Link: Lintasarta’s VSAT Net/IP and VSAT Link services are satellite-based data networking systems. VSAT Net/IP connects and controls data traffic among remote locations, allowing for development of data for network customers with low-to-medium traffic in such sectors as financial services, transportation, trading and distribution. VSAT Link provides point-to-point digital transmission for remote locations by businesses with medium-to-heavy traffic, such as those in the manufacturing, mining and financial services industries. Disaster Recovery Center and Data Center: The company provides disaster recovery center and data center services through its Company and Lintasarta. The company offers co-location, rack, cage, power, and other supporting facilities as value added services to corporate customers. The company also provides backbone or domestic leased line services from its disaster recovery center or data center locations to customer headquarters, as part of its total telecommunications solutions. IT Services: The company launched Indosat Cloud Services in 2012, with infrastructure-as-a-service as the first service offered in its cloud portfolio under a revenue sharing agreement with PT Dimension Data Indonesia. The company also launched ‘Indosat Managed Services’ in April 2013 which provides managed router and hosting services. Customers and Marketing The company’s customers for MIDI services are primarily corporate clients and small-to medium-size enterprises (SME), although the company also has wholesale and retail customers for certain services, such as its Internet services. The company’s marketing activities for MIDI services include exhibitions, participation in events, group presentations, seminars, direct mail, partner promotions, customer retention programs and advertisements in publications and printed media. Also, through its Indosat Corporate Solutions Micro site, the company provides corporate customers with convenient access to information about Indosat Corporate Solutions products and services and increase brand awareness of these services. Each business unit seeks to maintain existing customer relationships through activities, such as user forums, training seminars, courtesy visits and informal gatherings. Lintasarta is focused on expanding its market share in segments outside of its core competencies of banking and finance, in light of the anticipated consolidation and restructuring of those industries in Indonesia. The company supports its subscribers through local area staff, a 24-hour help desk and integrated real-time network management. Competition The company’s major competitors are Citra Sari Makmur, Tangara Mitracom, Satkomindo and Primacom with respect to its VSAT services, Telkom, XL, Icon+, and Citra Sari Makmur, with respect to its domestic leased line services, and Telkom, XL, and to a lesser extent, Matrix Cable System, PT Mora Telematika Indonesia (Moratel) and Icon+, with respect to its international leased line services. With respect to Internet-related value-added services, the company competes against Telkom and other existing ISPs, such as First Media, PT Supra Primatama Nusantara (operating under its trade name, ‘Biznet), PT Cyberindo Aditama (operating under its trade name, ‘CBN), PT Berca Hardayaperkasa and PT IndoInternet (operating under its trade name, ‘Indonet). The company faces competition from foreign and domestic service providers in each of these areas. In leasing its transponders on the Palapa-D satellite, the company competes most closely in Indonesia with Telkom and PT Pasifik Satelit Nusantara (Pasifik Satelit Nusantara). Pasifik Satelit Nusantara also owns transponders on the Mabuhay Philippines Satellite. Telkom currently operates its own satellites (Telkom-1 and Fixed Telecommunications Services The company’s fixed telecommunication services include international and domestic long distance, as well as fixed wireless access services. Services International Long-Distance Services: The company provides various international voice telecommunications services and both international switched and non-switched telecommunications services. Switched services require interconnection with either the PSTN or another mobile cellular operator’s facilities; non-switched services can be completed through its transmission facilities without the need for interconnection. Within its international long-distance services, the company offers a premium IDD service through its ‘001’ and ‘008’ access code. The company’s premium IDD service can be accessed by any operator in Indonesia. The company also offers a budgeted international call services under the brand name ‘FlatCall 01016,’ which offers affordable tariff rates targeting mass and budget oriented customers for certain top destination countries, and is only available to its subscribers. ‘FlatCall 01016’ become a unique selling point to its GSM products differentiating the company from its competitors. In 2013, approximately 20.5% of its outgoing international long-distance call minutes (including calls placed through ‘Flatcall 01016) originated from the province of East Java, followed by 7.9% originating from the province of West Java, and 33.1% originating from Greater Jakarta. The company’s outgoing international long-distance calls are routed through its two international gateways. Fixed Wireless Access Services: The company launched its fixed wireless access services in 2004 to complement its cellular services using CDMA 2000 1x technology. Local and Domestic Long Distance Services: The company launched local and domestic long distance service from Indosat access points such as ‘StarOne’ and ‘INDOSAT phone’ in October 2005. The company had local and domestic long-distance coverage of 152 major cities in Indonesia as of December 31, 2013. Customers and Marketing The principal customers of its fixed telecommunications services are corporate clients, its own cellular, fixed telecommunications and fixed wireless access customers, and the customers of other telecommunications operators. As of December 31, 2013, its cellular network operated using 10 MHz x 2 uplink and downlink of radio frequency bandwidth in the GSM 900 spectrum, 20 MHz x 2 uplink and downlink of frequency bandwidth in the DCS 1800 spectrum and 10 MHz x 2 uplink and downlink in the IMT-2000 spectrum. The company purchases its cellular telecommunications equipment primarily from European and Chinese suppliers. The company’s network is an integrated system employing switching equipment, cell site equipment and a transmission network of point-to-point microwave radio. Most of its cell sites and radio base stations are located in or on buildings or on vacant lots, which the company own, or for which leases have been individually negotiated by the company for terms typically varying from five to 20 years. Fixed Telecommunications Network The company has built a fixed telecommunications network consisting of two international gateways soft switch base served by satellite circuits, submarine cables and microwave transmission. The company also operates four gateways which the company uses to deliver domestic traffic and will be migrated to the international gateways’ soft switch base. As of December 31, 2013, the company offered fixed wireless access services across 83 cities in Indonesia. International Gateways: For its international long-distance business, the company operated through two gateways as of December 31, 2013, one in Jakarta and the other in Surabaya, which provided all of the connections for its services to its international long-distance network. The gateway-switching equipment was purchased from Nokia Siemens Network in 2012. As of December 31, 2013, the company had available international bandwidth capacity of 2,847 Mbps for voice and 140,000 Mbps for data transmission. All of its destinations are digitally connected. The bandwidth available to the company is significantly higher than the utilized capacity to allow for anticipated growth in traffic. The company has placed interconnection equipment at the facilities of Telkom and certain other cellular operators to connect its international long-distance network to the domestic telecommunications network. Submarine Cables: The company has ownership interests in and access to capacity in submarine cables interconnecting the Asia-Pacific region, North Africa and Europe, as well as those linking the Asia-Pacific region with North America. The company’s ownership interest in the SEA-ME-WE 3 submarine cable stands at approximately 3.4% while TCI’s ownership interest stands at approximately 0.3% as of December 31, 2013. The SEA-ME-WE 3 submarine cable does not have any landing point in Iran. The connection to Iran is through the UAE-Iran submarine cable system that lands at Fujairah Cable Landing Station in the United Arab Emirates. Other Communication Facilities The company’s Palapa-C2 and Palapa-D satellite communication systems and fiber optic links to major commercial centers, as well as remote areas of Indonesia are used in the provision of its MIDI services and for cellular backhaul. Satellite Communication System: The company offers the Palapa-D satellite. As of December 31, 2013, the company was using 11.60% of Palapa-D’s Standard C-Band transponder and 60.53% of Palapa-D’s Extended C-Band capacity and 0.51% of its Ku-Band transponder capacity to meet its own bandwidth requirements and the remaining 2.25% Standard C-Band transponder capacity, 17.17% Extended C-Band capacity and 0.12% Ku-Band transponder capacity was available for lease. Fiber Optic and Microwave Terrestrial Links: The company’s optical fiber backbone based on DWDM technology connects all provincial cities in Sumatera, Java, Kalimantan and part of Sulawesi. The optical fiber backbone conveys cellular traffic within and between the cities at 40-60 gigabits per second and facilitates its progressive growth of Internet broadband through 3.5 HSDPA and fixed broadband wireless access. IP/MPLS Backbone and Metro Ethernet Network: As of December 31, 2013, the company had completed its Metro Ethernet Network deployment project in approximately 1,061 nodes in Indonesia with fiber optic connectivity. Significant Events In April 2016, Indosat Ooredoo and International Business Machines Corporation (IBM) have announced that they will develop and deliver solutions on the IBM Cloud to help businesses streamline processes and improve productivity. This significant five year partnership will help better serve customers. History PT Indosat Tbk was founded in Indonesia in 1967. The company began its commercial operations in 1969.