Cheap tariff strategy in Indonesia

There are some reasons why telecommunication companies in Indonesia campaign cheap tariff to any telecommunication services they offered to the mobile telecommunication subscribers. Telecommunication companies used to applied cheap tariff to the prepaid phone number instead of postpaid phone number. The first reason, there are some new telecommunication companies which offered cheap tariff while they promote their new product and service. The second poor innovation of telecommunication services and as the result some of telecommunication companies rely on cheap tariff while mobile telecommunication subscribers made a session on basic telecommunication services either call, SMS or accessing internet through broadband internet service or CDMA 1x 2000

Once new telecommunication companies in Indonesia launched and offered cheap tariff to the call, SMS and wireless internet than the existing telecommunication companies will do the same few days later. Actually it is legal to offer cheap tariff to achieve as many as mobile telecommunication subscribers but telecommunication companies should give high performance of telecommunication service other wise the new mobile telecommunication companies will leave them and migrate to another telecommunication companies once their balance on prepaid phone number is zero due to they disappoint with the quality of telecommunication network.

Telecommunication companies should consider two things while they plan to promote cheap tariff to their new or existing telecommunication product and service. The first thing, the cost they should pay to lease several frequency channels for their license to the government as the telecommunication regulator.

As you know that telecommunication companies with GSM or CDMA platforms and mobile wireless access license should pay the frequency they have been leased more expensive than telecommunication with GSM or CDMA platforms and fixed wireless access license. Telecommunication regulator (government) is also giving lowest level tariff they should charge to their mobile telecommunication subscriber. Telecommunication companies with mobile wireless access license has higher tariff rather than fixed wireless access license. The second is the cost they have spent to invest the telecommunication infrastructures. Telecommunication companies should consider the investment they already spent while they plan to give cheap tariff to their mobile telecommunication subscribers. Telecommunication companies which has Manage Service (MS) with the vendor should be no issue while they plan to campaign cheap tariff strategy but not for telecommunication companies who already spend much money to invest the telecommunication infrastructures.