XL Axiata Eyeing Strong Growth in Data Revenue
Yessar Rosendar | March 05, 2010
With revenue from calls stagnating, XL is looking to phone internet services for more revenue. (Bloomberg Photo) Related articles
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Mobile phone operator PT XL Axiata said on Thursday it was aiming to more than double revenue from Internet data this year as growth in voice-call revenue leveled off.
“We expect data services to contribute 10 percent of our revenue this year,” said Hasnul Suhaimi, president director of XL Axiata, the country’s third-largest mobile phone operator. Last year, data services accounted for 4 percent of total revenue, up from 1 percent in 2008.
Hasnul said he expected data-service revenue to grow by an average of 40 percent a year over the next five years. This would help offset slower revenue growth from voice calls and declining revenue growth from text messages, he said.
XL Axiata is forecasting revenue of Rp 15.92 trillion ($1.72 billion) this year, a 14.7 percent increase from Rp 13.88 trillion last year.
Voice calls will still be the company’s main revenue earner. XL Axiata said it was targeting revenue of Rp 7.41 trillion from voice, up 5 percent from 2009.
Hasnul said the company would spend $450 million on capital expenditure this year, compared to $600 million in 2009.
Capex would be funded internally and the money would mainly be spent to increase network capacity improve and the quality of service, he said.
Akhmad Nurcahyadi, an analyst from PT Bank Negara Indonesia Securities, said XL Axiata was likely to achieve its revenue forecast this year. The company would also benefit from leasing its telecom towers to other companies, he said.
However, Akhmad said he doubted that XL Axiata could achieve its targeted growth in data-service revenue because the Palapa Ring undersea fiberoptic cable, which will serve as a backbone for Indonesia’s telecom network and connect many regions in eastern Indonesia, will not be completed until 2011, he said.
“The big increase for data will happen in 2011,” Akhmad said.
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