Dayamitra Telekomunikasi (Mitratel), Jakarta, Indonesia-based subsidiary of Telkom Indonesia, has taken specific measures to connect its portfolio of towers with optical fiber. In a release, Mitratel announced that it signed binding purchase agreements in December with two local companies, Sumber Cemerlang Kencana Permai and Trans Indonesia Superkoridor, for 6,012 route-kilometers of fiber connecting 2,436 towers across 86 cities and regencies in Indonesia.
Theodorus Ardi Hartoko, Mitratel’s Main Director, explained the acquisition is designed to support the move to 5G services, which he expects to pick up in the next few years. The acquisition of optical fiber also has the potential to open up new business opportunities that can provide added value to the company. Mitratel is striving to become a leading digital infrastructure company in 2023 by strengthening the 5G network service infrastructure with fiber.
Mitratel says that with its reach and tower count, it is currently the largest tower company in Indonesia. The addition of fiber optic ownership will make it easier for mobile network operators to expand their services wherever they are located because Mitratel already has satellite connectivity services.
“The acquisition of optical fiber is one of the right steps in supporting the acceleration of the fiberization process which is also part of the acceleration towards 5G adoption which is Mitratel’s main target in the next few years as an effort to support Indonesia’s digital sovereignty,” said Hartoko. “With the ease of connectivity that we offer, telecommunication operators only need to determine the desired location and all their infrastructure needs can be met by Mitratel.”
In its 3Q22 earnings presentation, Mitratel indicated that its tower and tenant growth is the highest in Indonesia, driven by strong organic development and smart inorganic activities. At the end of September 2022, Mitratel reported a base of 35,051 active towers. That figure is up 25 percent year-over-year from 28,079 in 2021. Tower tenants grew by 20 percent YoY to 50,390, up from 42,137 in the same period a year ago, giving it a 1.4 tenancy ratio. The company believes that the key to its fundamental growth will be to increase the tenancy ratio by adding collocations to the 25,000 towers in its portfolio with low tenancies.
MNOs have not expanded their 5G coverage in a big way to date because Indonesia’s government has been slow to release spectrum. Telkomsel and Indosat Ooredoo launched limited 5G service in a few cities in 2021. The Indonesian government is expected to release spectrum in the 700 MHz and 3.5 GHz bands this year and the 2.6 GHz band in 2025.
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