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Home » Blog » tariff-restriction-chronology-of-the-issue-of-lower-limit-of-internet-data-tariff
11 Sep 2017

Tariff Restriction: Chronology of the Issue of Lower Limit of Internet Data Tariff

 

Recently, telecommunication industry is going rampant with the issue of lower limit of internet tariff, which was proposed by a certain cellular operator, Indosat. How did it happen?

 

At July 19th 2017, Indosat’s President Director Alexander Rusli sent an official letter to Minister of Communication and Informatics Rudiantara. The letter proposed an idea to set internet tariff limitation in minimum level—usually called as lower limit internet tariff regulation.

 

In his opinion, the tariff of internet service in Indonesia has become more irrational, which in turn has made the competition in telecommunication industry become unhealthier. The dynamic of cellular network provider has become unreasonably unhealthy because of the strict competition between them, in which it’s usual to have tariff war. To avoid this, the government should intervene to regulate the amount of internet tariff.

 

To this day, the tariff of internet service hasn’t been regulated by the government, and that’s why any operator can freely set their own tariff.

 

In its development, the government side, which is represented by Ministry of Communication and Informatics, said that they will think over the suggestion and plan to regulate the lower limit of internet tariff. But, the government won’t set the number of tariff limit, but prepare formulation of its calculation depending on certain components.

 

The variables of data calculation vary a lot, and are uneven in Indonesia. There are a lot of variation in its tariff—normal, promotion, regional per area, and other kind of tariff.

 

Well, ideally, internet tariff that’s used by operator is through calculation of the cost of network’s elements plus retail or marketing cost, and profit margin. Then, based on that calculation, operator can decide internet tariff to customers.

 

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