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Indosat, Erajaya team up on retail business

Televenture: Indosat Ooredoo CEO Alexander Rusli (right) welcomes mobile phone distributor Erajaya Group president director Budiarto Halim at the launch of the two company’s joint venture, which provides telecommunications services and handsets under one roof in Jakarta on Tuesday

Dylan Amirio (The Jakarta Post)
Wed, November 25, 2015

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Indosat, Erajaya team up on retail business Televenture: Indosat Ooredoo CEO Alexander Rusli (right) welcomes mobile phone distributor Erajaya Group president director Budiarto Halim at the launch of the two company’s joint venture, which provides telecommunications services and handsets under one roof in Jakarta on Tuesday. Starting next year, the venture is to open 40 to 60 outlets, with investment of more than Rp 1 billion (US$73 million) per counter.(JP/Ricky Yudhistira) (right) welcomes mobile phone distributor Erajaya Group president director Budiarto Halim at the launch of the two company’s joint venture, which provides telecommunications services and handsets under one roof in Jakarta on Tuesday. Starting next year, the venture is to open 40 to 60 outlets, with investment of more than Rp 1 billion (US$73 million) per counter.(JP/Ricky Yudhistira)

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span class="inline inline-center">Televenture: Indosat Ooredoo CEO Alexander Rusli (right) welcomes mobile phone distributor Erajaya Group president director Budiarto Halim at the launch of the two company'€™s joint venture, which provides telecommunications services and handsets under one roof in Jakarta on Tuesday. Starting next year, the venture is to open 40 to 60 outlets, with investment of more than Rp 1 billion (US$73 million) per counter.(JP/Ricky Yudhistira)

Telecommunications company PT Indosat Ooredoo has formed a joint venture with major cell phone distributor Erajaya Group to further expand its retail business, part of the mobile phone operator'€™s masterplan to strengthen its digital operations.

New joint venture PT Satera Management Indonesia will run a number of Indosat Ooredoo retail outlets, starting with several locations in Java.

Indosat Ooredoo CEO Alexander Ruslie expressed hopes that the joint venture would '€œbring a new customer experience to [their] customers'€. Among the changes that will take place are the easing of mobile device purchases, trade-ins and a more streamlined access to Indosat'€™s upcoming improved 4G/LTE network, which the company says will likely arrive by the end of November.

'€œThis venture is also part of our rebranding masterplan to focus more deeply on the digital services aspect of our operation, following our rebranding as Indosat Ooredoo. The collaboration of services does not merely stop at bundling packs, for example, but could be so much more. You will see the progress in the near future,'€ he said on Tuesday.

Each company will hold an equal 50 percent share in the venture, which will spend about Rp 1 billion on each new outlet to be built in 2016.

 Erajaya Group'€™s retail CEO Jeremy Sim explained that between 40 to 60 new retail outlets, run jointly by both companies, would be opened next year. The first joint outlet, he said, would likely be opened by the end of the year.

'€œIndosat'€™s role is to provide the services, while Erajaya will be in charge of the retail aspect. Erajaya will be the main financial investor in the venture, and we will continue to focus on selling mobile devices bundled with Indosat'€™s services,'€ he told reporters on Tuesday.

Jeremy added that part of the reason why the venture took place was because of a desire by Erajaya to move beyond selling cell phones and mobile devices, but to also market telecommunications provider services, hence the collaboration with Indosat.

He said that its line of Erafone and iBox retail outlets would not be affected by the venture. The company specializes in distributing several notable mobile brands including the Apple iPhone, Samsung, BlackBerry, Sony and Nokia.

Indosat'€™s partnership with Erajaya would also potentially boost smartphone sales, thereby increasing national smartphone penetration and mobile internet usage, Alex added.

Relating to this fact, a third quarter report recently issued by Opera Mediaworks and the Mobile Marketing Association (MMA) said that Indonesia was one of the countries in the Asia-Pacific region with the highest percentage of mobile internet users, with 93.16 percent of the population using the devices.

In the first nine months of 2015, Erajaya Group booked profits of Rp 169.3 billion while Indosat booked losses of up to Rp 1.1 trillion, blaming much of their loss on the Rupiah'€™s depreciation.

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