When "On Net" is no longer enough
Until recently, the name of the battle for cheapest tariff in Indonesia is "on net" battle. Basically operators are racing to reach the new limbo of who offer the lowest tariff for calls between subscribers of the same operator (on-net). It varies from Rp 1 per second, Rp 1000 per hour, Rp 50 per minute, Rp 1 per minute, Rp 50cents per second, Rp 0, and so on. We jokingly wonder when it will reach minus sign...
This is a good sign (for the subscribers) that the industry is getting more competitive. Not for the operators (and vendors).
When that is no longer enough.... the battle now shifts to who gives the cheapest off net... If you can get like Rp 1 per minute for on-net, why the cheapest for off-net was way above that?
Fren started this on the 14th of January 2008.... "Fren Fact": Rp 700 per minute (US 7~8cents) to "any GSM operators, anywhere, anytime." I haven't checked whether the claim is 100% correct, but well, I assume they did have their research done before launching the claim.
Then XL strikes back with "0.10 Rupiah per second to all operators" -- or seemingly cheaper than Fren with per minute charge of Rp 6 (six rupiah!). Launched just 4 days after Fren's campaign.
Although after reading the terms & conditions, it is just complicated... First of all, it's only for their prepaid customers (Bebas Prepaid Card) and there are different tariffs for different regions. Then the scheme is just complicated: Rp 25/sec for the first two minutes then Rp 10cent/sec for the next two, then back again to 25/sec.
XL previous positioning statement was "no terms and conditions."
It is an interesting time in life for mobile (operator) marketers. Life and death. Why do we always resort to price as the ultimate marketing weapon?
I need to point you to another interesting article comparing Indonesian & US phone price: Reality Check - Wireless Service in Indonesia. The writer showed a good point that on nominal basis, American cellphone calls are twice or three times more expensive Indonesian. However, the comments are also correct by pointing out the difference in GDP. (Based this Wikipedia article, USA PPP is about 12 times of Indonesia). Though in Indonesia we allow subscribers to purchase and consume airtime in very small denomination. And with this recent battle, it's definitely going to be a lot cheaper now...
Anyway, my closing remark is watch the price development of Indonesian mobile phone industry... (and similarly, have a look at India).
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