At this year’s Mobile World Congress, Indosat Ooredoo Hutchison (Indosat) CEO Vikram Sinha told journalists the merger was a case of being ‘at the right place at the right time’.
Vikram Sinha, President Director & CEO of Indosat Ooredoo Hutchison
When Indosat Ooredoo and Hutchison 3 Indonesia first announced their $6 billion merger back in September 2021, the news was met some scepticism by analysts, who noted the challenges the two companies would face when it came to integrating their networks creating a unified company culture.
Now, however, one year on from the merger’s competition, and these doubts have been silenced, with Indosat going from strength to strength.
In the last year, Indosat has seen its subscriber base increase by six million people, generating an increase in its organic net profit of 76.2% year-on-year.
Speaking to journalists at this year’s MWC, the company CEO Vikram Sinha explained that the merger had given the company the scale it needed to reach millions of additional customers, particularly in rural and hard-to-reach areas that were previously not economically viable.
In fact, over the next four years, Indosat is reportedly aiming to connect 21 million customers that have never been connected to the internet before, focussing on largely underserved areas like Papua.
But beyond reaching new customers, Sinha notes that a key growth component for the company will be its engagement with the millions of micro- and small enterprises that make up the backbone of the Indonesian economy.
When asked how Indosat planned to engage with these businesses, Sinha made clear that the challenge lay not only in providing coverage to these businesses, but in encouraging them to join the digital economy.
“Connecting is the first step, but we must help them to enter and grow in the digital marketplace,” he said, noting access to money lending and digital banking services. “Once they can make $10, they will be more than happy to give us $1 for connectivity services.”
Naturally, a large part of connecting these new customers and businesses will centre around the rollout of existing technologies, like 4G and fixed wireless access (FWA), but the eventual rollout of 5G is also set to play a key role in Indosat’s future growth.
Currently, the company has around 400 commercial 5G sites live in six cities across the country, with Sinha noting that the company was fully prepared for C-band spectrum to become available in the upcoming auction before it expands in earnest.
The date for such an auction has yet to be announced by the Indonesian regulator.
Sinha said that the company would benefit from studying the 5G developments currently taking place in neighbouring countries like India and the Philippines, allowing them to be better prepared when the time comes.
He also made clear, however, that Indosat was not waiting for the advent of 5G when it comes to ushering in the era of Industry 4.0. Sinha explained that the operator was already in discussions with various vertical industries, including mines and ports, to better understand their technology needs.
“We need to get the ecosystem involved right now,” he said. “The key message is: there is a lot of opportunity here.”
For Sinha, the merger has been a resounding success, presenting a clear path to future growth for years to come. The main challenge moving forward – as is always the case for Indonesia’s telecoms sector – is the nation’s geography. With a population spread across around 18,000 islands spanning an area the size of Europe, achieving widespread coverage is difficult, even more so when trying to do so in a cost-effective and profitable manner.
This is perhaps why Sinha closed his press conference with the phrase ‘Gotong Royong’, an idea central to Indonesian culture that focusses on communal work for communal success.
“We need successful partnerships to bring the major benefits to customers and to enterprises,” said Sinha. “We have to build consumer trust and bring them simple and transparent products. For this, we need partners that share our vision.”
To learn more about Indosat Ooredoo Hutchison, please click here.