Indonesia Telco Introduction

This post is for people who is interested to start investing in telecom players and want to understand the basic of the industry. It can be non-Indonesian who is interested to invest or build career or Indonesian who wants to understand deeper about the industry.

What is included in the telco industry?
Referring to the word “telecommunication”, which we can break down into two main parts: (1) Tele = at distance, and (2) Communication = means of sending and receiving information, the telecommunication industry make money by providing service to sending and receiving information at a distance. To be relevant with the current telecommunication context, I will be ignoring 3 communication devices/services: (a) telegram: which it is uncommon for us to use now, (b) mail: which if we think deeply, sending and receiving physical mail is more into logistics arena instead of the telecommunication that we know today, and (c) radio/television: radio and television broadcasts are commonly known as mass media.

Referring to the government regulation no. 52 about Telecommunication, telecommunication definition is “everything that is related to signal emission, sending or receiving information in the form of writing, sound, picture, etc. through optical, radio, wire, or other electromagnetic system.

Further, the in the government regulation, it is specified that the provision of telecommunication system can be breakdown into 3 things:

• Provision of telecommunication network → I think this is referring into the infrastructure providers, such as fiber optic, tower companies.
• Provision of telecommunication services → This is referring to the mobile and fixed line operators.
• Provision of special telecommunication services → This one is quite niche. For example, the company that provide satellite connection for military purposes.

In the common business context, the telecommunication industry is more relevant to the providers of fix and mobile communication as well as the providers of supporting infrastructure:

• Fixed / land line telephone providers
• Mobile operators: The companies that provide
• Tower providers to support signal transmission
• Fiber optic providers, including Fiber-to-Home (FTTH) and Fiber-to-Premises (FTTP)

Although messaging and social media apps are can be categorized as the providers of telecommunication services, the common industry categorization excludes those app — people tend to categorized these apps into technology industry.

Telco companies in Indonesia
The easiest way to find companies that is included in the telecommunication sector is through the categorization based on Indonesia Stock Exchange. However, you will not find telecommunication sector in the list of categorization. Instead, telecommunication sector is included as part of Infrastructure sector, together with heavy construction and other utilities companies.

Although not entirely accurate, looking into this list may help us to find which companies are included in the telco definition. As per 2022, there are 57 public companies listed in the infrastructure sector. From the list, the companies that we can categorize as the telco is as follows:

1. PT Telkom Indonesia Tbk — Ticker: TLKM
2. PT Smartfren Telecom Tbk — Ticker: FREN
3. PT Indosat Tbk — Ticker: ISAT
4. PT XL Axiata Tbk — Ticker: EXCL
5. PT First Media Tbk — Ticker: KBLV
6. PT Link Net — Ticker: LINK
7. PT Bali Towerindo Sentra Tbk — Ticker: BALI
8. PT Bakrie Telecom Sentra Tbk — Ticker: BTEL
9. PT Centratama Telekomunikasi Indonesia — Ticker: CENT
10. PT Gihon Telekomunikasi Indonesia Tbk — Ticker: GHON
11. PT Visi Telekomunikasi Indonesia Infrastruktur Tbk — Ticker: GOLD
12. PT Inti Bangun Sejahtera Tbk — Ticker: IBST
13. PT LCK Global Kedaton Tbk — Ticker: LKCM
14. PT Solusi Tunas Pratama TBk — Ticker: SUPR
15. PT Tower Bersama Infrastructure Tbk — Ticker: TBIG
16. PT Sarana Menara Nusantara Tbk — Ticker: TOWR

The first four companies is the mobile operator companies that serve 100% of the mobile customers in Indonesia. These mobile operators companies are commonly have other businesses as well although most of the revenue is coming from mobile services. These companies have extended telecommunication businesses such as internet connectivity, home broadband (FTTH) services, Internet Communication and Technology solutions for enterprises, even to the digital app businesses.

The rest on the list comprise of tower providers for network connectivity, fiber optic connectivity services, data center, and other solutions that revolves around telecommunication and technology.

Have fun browsing these companies! I will post more articles about Indonesian telecommunication ecosystem soon.

Enjoy.