The convergence of broadcasting and telecommunication: 
A prospective look at Indonesia’s experience
in the making of Broadcasting Law

Presented at the 5th Regulatory Roundtable 
for Asia and Pacific Broadcasting; Wellington, 2 – 4 October 2000
by
National Board of Information and Communication

A.	Introduction.

Previously, Administrative services run under the 1945 Constitution by Indonesia’s Government were characterized heavily on Centralized authority at the National level with a bureaucratic style attained for its likely public services. That kind of lip services were also applied for broadcasting and telecommunication field.

In that matters, monopolistic rules and regulations of broadcasting services are exemplified within the Act of 24 / 1997, while telecommunication act of 36/ 1999 were still maintain the duopolistic rules for the common carrier which were subsidized by government at the two state-owned company, namely Indosat and Telkom.

Meanwhile, broadcasting as the fourth estate medium resumed responsibility to spring the freedom of expression, as that of printed press’ sibling. After almost three decades heavily burdened by non government professional association of broadcasters that pressured on the bureaucratic services, broadcasting experienced a freer climate for its business.

B.	Regulatory regime prior the Reformation.

Prior to the reformation era, at the time of declining Soeharto’s regime, dual regulation in the hand of differing authority for broadcasting were existed. Namely, broadcasting frequency were regulated by the Ministry of Communication ( and transportation), and broadcasting content by the Ministry of Information. 
Intervention by  broadcasting association toward  administrative occurred during that period of time. A necessary requirement for approval that had been obtained from Association of the Privately owned Indonesian National Radio Broadcasting prior to get license. Government services were unanimously heavily pressured by the Association whom chaired by the daughter of President Soeharto. 

Frequency mapping was also regarded as a privileged information that could not be accessed by common citizen at  any time, but an exclusive monopoly for its elite cliques.

During the Reformation Era, people movement brought about the changing of freedom of expression that resulted in the excluding license for printed press.  Under the Ministry of Information headed by Mr. Yunus Yosfiah, that kind of de-regulating atmosphere were not much formally affecting the broadcast industries. Practically it has the similar effect, in the form of postponement of the Broadcasting law due to its monopolistic sphere. 

Meanwhile, non discriminatory bases  services were still in questions during that Reformation era. Due to the fact that the  24/1997 is formally still  a legal rules, even not wholly applied, so that  some of radio and television broadcasting applicants benefited from its situation. Further more, after the general election and the establishment of Gus Dur’s Presidential Cabinet Ministers, such kind of vacuum of power had been happened.

One of the reason caused to that condition was the liquidation of the Ministry of Information, which previously monitored the broadcasting program and its content. As a result, broadcasting industry has the benefit of non regulatory existence. On the other hand, accompanying the freedom of expression era, the establishment of brand new of privately owned broadcasting company, primarily radio sprung through out the country. At least five newly private television stations and more than three hundred privately owned radio broadcasting were enacted by the people, either through administrative procedures or by-passing of its requirement.

Although the climate was conducive enough toward the newly establishing company, but with the lack of monitoring procedures and the vacuum of authority at the defending public interest, then the business climate were not a favorable one.  Though competition had been occurred and the obedience toward broadcasting code of conducts were varied. Some newly applied license has lack of both, experience and technical skill. In addition, with the freer tolerance of news relay broadcasting, there were no more relay news from government owned station such that had had occurred before.

Public broadcasting services versus privately owned profit oriented broadcasting services got caught in conflicting  issues in terms of overlapping financial support and sources of revenue from advertising. With the Government Regulation no 36/2000 and 37/ 2000 government owned radio and television broadcasting were claimed themselves as a public services broadcasting. Meanwhile, the privately owned broadcasting association as well as others institution claimed that the overwhelmed government owned broadcasting industry should not solely claimed itself as a public services, while they had to maintain its financial dependencies toward the executives branch.

C.	The need of de-regulation and globalization.

The globalization stream that flourish through out the globe characterized by the unification of global market, placed government bureaucratic services under scrutiny. Red tape administrative procedures were in questions, as well as the state ownership businesses entity that claimed as a public services. 

For keeping up with the market demand,  stream lining services at some of the government institution  were enacted. Independence broadcasting committee was at the stake, when privately owned broadcasting association cry for help to liberate the frequency distribution from government intervention. 

It seemed that at the one hand,  diversification of content and cross ownership were being needed to maintain democratic climates in the field of broadcasting. On the others, regulating scarcity broadcasting electromagnetic waves were need to switch from government affairs toward an independence body or committee.

Transparency in pursuing broadcasting license were a cry for public to be liberate, due to its prior non existence under the transition regimes.

D.	The convergence of technology and its social impact

Digitalization of broadcasting as the advancement of technological innovation pursued its state of the art being, while the analog is still in place. At the customers end, the multimedia phenomenon were similarly attaining its peak for the sake of market share. Digital words are common as they show in media advertising, but the spread of electronics appliances are narrowed.

Meanwhile government has partially lose its dual roles in the field of broadcasting content, but stumbling block in maintaining  the frequency regime. During the process of re-making of broadcasting law, the initiatives were at the legislative branch. Non government organization backed by foreign aid, found its way to support legislative with the academic draft. Along with the ruling of non government organization, mainly media watch, initiating process of academic drafting signaling the beginning of public participation. Seven academic drafts were promulgated during this freer era of public participation, Some seminars or discussions were being held at different regions. Various aspects of broadcasting entities were raised into questions by different people from all walks of life, primarily from broadcasting society.

For accommodating the merging of broadcasting and telecommunication in the form of multi media, is not a simple job. 
Stipulation of Presidential Decree  No 96/ 2000 regarding the negatives list of investment field faces  harsh criticism from industry so that government has to accommodate for withdrawal. 

Find its way of no match with the multimedia phenomena, the Presidential Decree No 108/2000 liberating multi media industries that made it more suitable for foreign investment up to 95 % of its share. Meanwhile, the duopolistic of government subsidized telecommunication companies still have their lucrative position up to the year of 2004.

At the mean time, differing position of broadcasting and telecommunication industries have to the balance the development along with reform needs. For the globalization sake, the national infrastructure development now are being reviewed at policy level. National Information Technology Framework still find ways to accommodate a new brand territorial approach of converging between broadcasting and telecommunication. Due to its complexity of technology, archipelagos’ terrain, multi channel usage and diversity of ethnicities as well as the advancement of local society.
The media puzzles as well as the technological convergence issues are in awaiting solution. For broadcasting and telecommunication law are still in each codification, then waiting a unified codex is a long term endeavor.

Under the Telecommunication Act of 36/1999 which are implemented from September 8, 2000, the two government subsidized telecommunication carrier industries – Telkom Tbk and Indosat Tbk -  lose its bite due to the end of duopolistic status. Others telecommunication players welcome the ending periods of duopolistic, that made the telecommunication industry more competitive.

Regarding the globalization era, this act is a milestone for telecommunication players to do business either in full service providers, full service network or special telecommunication services without having to make a partnership with both government subsidized enterprises. The end of duopolistic state is also marking a competitive era in telecommunication business, where any new players either domestic or foreign investor can play.

The only different between domestic and foreign share in terms of investment opportunities are for foreigner have the maximum investment up to 49 % for basic telecommunication services and telecommunication infrastructures. Multimedia industries have the optimum opportunities for foreign investors to be allowed to invest up to 95 %.

E.	Optimizing the convergence technologies for societal empowerment

With the decentralization of government authority and local autonomy delegation of power, the administrative reform under the Reformation regime  are in progress. Under the acts of 22/1999 and 25/1999, local government have their capacity in licensing the telecommunication aspect, specifically for cooperative and local government subsidized enterprises (BUMD) to do business in telecommunication services, either local (by Chief district or bupati) or regional (by governor). Maintaining national unity with the unified radio wave management is a need, and the independence committee for regulation of broadcasting is mingling between old style government services and the new one for submitting authority under the legislative branch.

Event though the competitive spirit, gives an equal chances for playing the field in telecommunication industries, it left the privileges for Telkom Tbk and Indosat Tbk. They still have the opportunity to maintain its privileges in terms of the exclusive right to conduct long distance connecting call (SLJJ) up to 2003 and international telephone services up to 2002. (Previously, government wishes to prolonged that privileges up to 2010, but many sectors cried to end it up).

Meanwhile, the acts of 22/ 1999 and 25/1999 concerning decentralization of authority and balance of financial resources  places local radio wave management and cable television under the auspicious of municipal and district authority. Problems that could be rose within these regulated matters would be conflicting frequencies in the border areas, as well as the concentrated market segment and customer’s or political party members niches.

In addition to its mainstream for privately owned commercial broadcasting and government backed public services, Community broadcasting serves as the alternatives stream. The spring of community broadcasting were advanced by academic and campus based experimental radio broadcasting, as well as the abundance of financial support from local government backed industry that initiate local television cable. 

The pursuit of community broadcasting and placement in the view of regulation were based for social participation reasons in line with the democratization and political education reform. With the flourishing of community broadcasting,  two goals could be attained, namely diversification of local content and cross-ownership of broadcasting industry. Therefore, monopolistic style could be eliminated gradually.

In the sphere of reformation and de-regulation era, National Independence Broadcasting Committee seems appropriate for future attainment, as the solution for avoiding government administrative burden in licensing and placing the broadcasting authority under public interest and attention.

F.	Regulatory framework in the making

Allocation of radio frequency for broadcasting purposes are the prolongation of the ITU authority on each state or countries. In this regard, radio frequencies mapping  should be conducted base on the national level policy and that could be implemented regionally or locally. The principles that have to be implemented were while tailoring the allocation on each region or district, it has to be considered to avoid conflicting frequencies at the border territory. 

Furthermore, the licensing should be applied base on the non discriminatory principles, no barrier for new entry licensing application, transparency procedures and  information access openly for public accountability. In terms of maintaining the diversity of content and cross ownership of broadcasting industry, there have to be enacted the umbrella ownership limitation principles and avoiding the concurrent occupation among mass medium ownership in the hand of holders at the same territory.

Maintaining cross ownership and diversified local content is a must that has to be maintained for diversity of expression and  flourishing biodiversity in local content as well as to promote local culture.

In addition, University broadcasting as an alternative to its mainstream are being given a chance to allow for educational experiment expanding its technological capability and innovation for public contribution. Next, public participation could also be broadened by sprouting the community broadcasting. As a model of means to exchange opinion and expression among rural people at local level, that kind of community broadcasting with a simple amplitude modulation radio broadcasting and micro power transmitter station, each rural could bond together to build radio network.

G.	Conclusion

In line of shifting paradigm of government from centralized to less governing style authority, the independent broadcasting committee seems suitable to accommodate populace demand.

Social participation for maintaining diversity of local content and cross ownership, could be  elaborated in the regulation sphere by implementing legislative initiative draft. With an open debate and public discussion discourses during the process of law making, many and different view point could be heard and accommodated. 

Serving national interest by implementing universal principles, the independence broadcasting committee seems to find its way in politically appointed committee members, where as the administrative office could be run by clerical public servant of government  carrier employee.