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Workshop on Economic Aspects of Spectrum Management 21-23 November 2016, Teheran – I.R. Iran

Economic Aspects of Spectrum Management: An Indonesia Case Study

Dr. Muhammad Imam Nashiruddin, MT The Comissioner Indonesia Telecommunication Regulatory Authority (BRTI) Email : [email protected] | [email protected] |

Indosat IR - New Template v23 1220.pptx 1 Agenda

1 COUNTRY PROFILE : INDONESIA

2 BRTI & NATIONAL SPECTRUM MANAGEMENT

3 SUMMARY OF ICT MARKET IN INDONESIA

4 SPECTRUM MANAGEMENT CASE STUDY

5 LESSON LEARNED AND CHALLENGES

2 IR - New Template v23 1220.pptx 2 COUNTRY PROFILE : INDONESIA

34 provinces* Population*: 248.8 million 511 districts/city* 80,714 villages*

*2013 source: Indonesia Statistics Agency, 2014 3 Indosat IR - New Template v23 1220.pptx 3 THE ARCHIPELAGO ECONOMY : UNLEASHING INDONESIA’S POTENTIAL

Source: McKinsey Global Institute, September 2012

4 Indosat IR - New Template v23 1220.pptx 4 ICT INFRASTRUCTURE PROFILE : FO Backbone NATIONAL BACKBONE

FO backbone covers more than 72% of districts. Our National FO systems (PALAPA RING) will be ready for service in 2018. 5 Indosat IR - New Template v23 1220.pptx 5 ICT INFRASTRUCTURE PROFILE : RADIO ACCESS NETWORK

Cellular BTS Coverage

2G , 3G and BTS cover all provinces providing more than 90% coverage of cellular.

6 Indosat IR - New Template v23 1220.pptx 6 SOCIO-ECONOMIC OF BROADBAND

7 Indosat IR - New Template v23 1220.pptx 7 INDONESIA BROADBAND PLAN TARGETS

2013 2019

Urban: Fixed Broadband: Fixed Broadband: 71% HH (20Mbps); 15% HH (1Mbps) and 5% population; Mobile Broadband: 100% pop (1 Mbps)

Mobile Broadband: Rural: 12% population (512 kbps) Fixed Broadband: 49% HH (10Mbps); Mobile Broadband: 52% pop (1 Mbps)

Utilization: . Broadband service price: max 5% of average monthly income . Priority Sectors: e-Government; e-Education; e-Health; e-Logistic, e-Procurement

8 Indosat IR - New Template v23 1220.pptx 8 BRTI & NATIONAL SPECTRUM MANAGEMENT ORGANIZATION STRUCTURE

Minister of Communication and REGULATORY AREA Information Technology POLICY AREA

FUTURE Telecommunication THE COMISSIONER OF BRTI Regulation Comitte EXPANSION OF (The BRTI Comissioner) BRTI MEMBER

Directorate General of Directorate General of Directorate General of Research and Human Post and Information Resource Management Directorate General of Public Communication Resource Development Technology (Chairman Application of (Vice Chairman of BRTI Information Technology and Information Center of BRTI Comissioners) Comissioner)

Directorate of Office of Directorate of Spectrum Secretariat of Directorate of Spectrum Directorate of Spectrum Standardization of Telecommunication Management System Directorate General Policy and Planning Operation Postal and ICT Equipment Testing and Control Equipment Laboratory

Regional Office of INDONESIA TELECOMMUNICATION REGULATORY AUTHORITY - Radio Frequency Spectrum Monitoring BRTI (37 Offices)

9 Indosat IR - New Template v23 1220.pptx 9 INDONESIA CELLULAR PROVIDER (Q3/2016) OPERATOR SUBCRIBER RADIO ACCESS NETWORK TECHNOLOGY

118.140.245 850/900/1800/2100 (52,5 MHz) 2G/3G/4G

50.846.707 850/900/1800/2100 MHz (40 MHz) 2G/3G/4G

45.000.000 900/1800/2100 MHz (45 MHz) 2G/3G/4G

25.102.343 1800/2100 MHz (20 MHz) 2G/3G/4G

2.438.843 850/2300 MHz (30 MHz) 2G/3G/4G

52.402 450 MHz (7,5 MHz) 2G/4G

Indosat IR - New Template v23 1220.pptx10 10 IMT SPECTRUM USED IN INDONESIA (195 MHZ)

40 MHz 52,5 MHz 45 MHz 10+30 MHz 10

20 MHz

2,5 + 5 MHz 7.5 7.5 10 Sampoerna

450 MHz

AVAILABLE FOR 2016 AUCTION : 2x10 MHZ (FDD 2100) + 1x30 MHz (TDD 2300)

Indosat IR - New Template v23 1220.pptx 11 INDONESIA CELLULAR MARKET will grow to IDR 140 Trillion by 2020, fuelled by data revenue growth

12 Indosat IR - New Template v23 1220.pptx 12 INDONESIA CELLULAR MARKET The Scissor Effect

13 Indosat IR - New Template v23 1220.pptx 13 SPECTRUM MANAGEMENT FOR MOBILE BROADBAND ACCELERATION

14 Indosat IR - New Template v23 1220.pptx 14 OUR REGULATORY MAIN STAKEHOLDER

GOVERMENT 1. TELECOMUNICATION PENETRATION 2. CYBER SOVERNEIGHTY 3. ECONOMIC GROWTH 4. NATIONAL COMPETITIVE ADVANTAGE

INDONESIA TELECOM REGULATORY AUTHORITY INDUSTRY PEOPLE 1. HEALTHY COMPETITION 1. CUSTOMER PROTECTION 2. CLEAR & FAIR REGULATION 2. CUTOMER PRIVACY 3. BUSINESS SUSTAINABILITY 3. DATA PROTECTION & DATA PRIVACY SPECTRUM PRICING

17 Indosat IR - New Template v23 1220.pptx 17 SPECTRUM PRICING

18 Indosat IR - New Template v23 1220.pptx 18 MANAGING SPECTRUM OF 450 MHZ

Channel Arrangement

19 Indosat IR - New Template v23 1220.pptx 19 MANAGING SPECTRUM OF 800 MHZ + E-GSM CASE STUDY : RE-FARMING & RE-PURPOSING

A

B

20 Indosat IR - New Template v23 1220.pptx 20 MANAGING SPECTRUM OF 900 MHZ CASE STUDY : NEUTRAL TECHNOLOGY

Technology Evolution Path (All Operator are already contigous) : GSM/EDGE  UMTS  HSPA  HSPA+  LTE

All Operator ready to implement UMTS / 3G 900

21 Indosat IR - New Template v23 1220.pptx 21 MANAGING SPECTRUM OF 1800 MHZ CASE STUDY : RE-FARMING

7.5 MHz 5 MHz 7.5 MHz 15 MHz 5 MHz 15 MHz 10 MHz 10 MHz XL ISAT TSEL XL TSEL ISAT TSEL H3I

22.5 MHz 10 MHz 20 MHz 22.5 MHz XL H3I ISAT TSEL

22 Indosat IR - New Template v23 1220.pptx 22 MANAGING SPECTRUM OF 2100 MHZ CASE STUDY : RE-FARMING

11 12

23 Indosat IR - New Template v23 1220.pptx 23 MANAGING SPECTRUM 2300 MHZ CASE STUDY : CONSOLIDATION

Existing

1 2 3

Plan

Spectrum auction at Allocate to Smartfren - Regional BWA endorse for the December 2016 (30 MH) as consolidation of mobile national (30 MHz) compensation for coverage (30 MHz) migration from PCS1900 & swap for CDMA 850 MHz

24 Indosat IR - New Template v23 1220.pptx 24 OUR NEXT CHALLENGE TO FULFILL SPECTRUM SCARCITY

25 Indosat IR - New Template v23 1220.pptx 25 RE-PURPOSING 2,6 GHZ ?

2500 2570 Band 7 UL Band 7 DL 2570 2620 Band 38 TDD

Band 41 TDD 2496 2690

2500 2520 2670 2690 BWA BSS BWA

26 Indosat IR - New Template v23 1220.pptx 26 DIGITAL DIVIDEN 700 MHZ (2018-2019)

ANALOG TELEVISION ERA 328 MHz 478 806 MHz TV Analog Penerimaan Tetap Free To Air (FTA)

BROADCASTING DIGITALIZATION (ASO)

DIGITAL TELEVISION ERA Future Digital TV Terestrial DIGITAL DTV Free To Air (FTA) DIVIDEND 478 526 694 806 MHz 192 MHz 112 MHz

There is 112 MHz (694 – 806 MHz) Digital Dividend available, or 2 x 45 MHz FDD can use to accelerate mobile broadband in nation 28

Indosat IR - New Template v23 1220.pptx 28 SPECTRUM SHARING POLICY

29 Indosat IR - New Template v23 1220.pptx 29 LTE RAN SHARING WITH MOCN SPECTRUM SHARING

PLMN ID A PLMN ID MNO A Core MNO B B City #1 Frequency POI MNO B PLMN ID A PLMN ID HSS B GW MME HSS Transmission Access MNO Site #1 A POI MNO A GW MME HSS Site #2 Home Core MNO A Shared Dedicated eNodeB Transmission Core

PLMN ID MNO B Core MNO B PLMN ID MNO B MNO A Frequency POI MNO B City #2 PLMN IDMNOPLMN B ID MNO A GW MME HSS Transmission Access MNO Site #3 B POI MNO A GW MME HSS Site #4 Home Core MNO A Shared Dedicated eNodeB Transmission Core

30 Indosat IR - New Template v23 1220.pptx 30 The Way Forward : Hybrid Model for Indonesia Case

URBAN : SUB-URBAN / RURAL : • High Populated Area • Less Populated Area • PASSIVE SHARING - MNO build • ACTIVE SHARING – 4G/3G MOCN & 2G RAN Sharing for their own network to get more MORE EFFICIENT Network Roll-out and better COVERAGE CAPACITY

31 Indosat IR - New Template v23 1220.pptx 31 The Way Forward : Trend of Regulation Flexibility

1. Technology Flexibility : Neutral Technology 2. Infrastructure Flexibility : Network Sharing 3. Coverage Area Flexibility : National Roaming 4. Spectrum Flexibility : Spectrum Sharing/Trading 5. Operations Flexibility : MVNO, Managed Services ?

32 Indosat IR - New Template v23 1220.pptx 32 LESSON LEARNED & RECOMENDATION

1 SPECTRUM SCARCITY IS HERE, NETRAL TECHNOLOGY – NETRAL SERVICES ?

2 SPECTRUM FLEXIBILITY IS INEVITABLE

3 COLLABORATIVE REGULATION (5.0) IS NEEDED

4 KEY SUCCESS FACTOR : MULTISTAKEHOLDER APPROACH

33 Indosat IR - New Template v23 1220.pptx 33 Twenty years from now you will be more disappointed by the things you didn't do than by the ones you did do. So sail away from the safe harbour. Catch the trade winds in your sails. Explore. Dream. Discover.

- Mark Twain

Indosat IR - New Template v23 1220.pptx 34