Proving Its Adaptability, Telkom Shifts Focus to B2B

PT Telkom Indonesia (Persero) Tbk. has demonstrated its adaptability to technological advancements. This is evidenced by the company's decision to shift its business group's focus towards the business-to-business (B2B) segment.

One recent step taken in line with this strategy is the transfer of IndiHome to Telkomsel, scheduled for July 1, 2023. This aligns with Telkom's plan to have Telkomsel take charge of the business-to-consumer (B2C) segment.

Honesti Basyir, Director of Group Business Development at Telkom, acknowledges the significant revenue potential in the B2B segment. Thus far, the company has not fully tapped into the profit potential of the business-to-business sector.

"Indeed, entering new services in a company as large as Telkom is not easy, especially in the B2B sector. But with the Five Bold Moves, we hope to seamlessly achieve all our objectives," Honesti said during an interview with Katadata at the Bali Annual Telkom International Conference 2023 in Nusa Dua, Bali, on Wednesday (6/9).

The decision to transfer IndiHome to Telkomsel is part of the implementation of Telkom's primary strategy, the Five Bold Moves, which includes InfraCo, Data CenterCo, DigiCo, B2B Digital IT Service Co, and Fixed Mobile Convergence (FMC).

The integration of IndiHome into Telkomsel is a manifestation of the FMC initiative. "The integration of fixed broadband into wireless broadband is expected to provide a new and improved user experience, along with numerous opportunities to deliver new services," Honesti stated.

The B2B segment that Telkom will be focusing on encompasses a variety of digital solution platforms. In the future, to further develop this business-to-business sector, the company has the option to pursue it independently or collaborate with technology startups.

Telkom's focus on the B2B segment is believed to have a long-term impact on the company's revenue while reducing capital expenditures and creating new business opportunities. However, the contribution of B2B to the company's current revenue is still relatively small.

The decision to refocus on B2B is also driven by Telkom's recognition that digital businesses cannot thrive in isolation, especially when it comes to driving digital transformation. "Participation is the key," said Honesti.

So far, Telkom remains committed to its transformation into a digital company, or a digital telco, as it is commonly referred to. Three portfolios are being targeted: digital platform, digital connectivity, and digital services.

"In essence, this transformation is aimed at becoming a digital company. It's a strategy that we must execute," Honesti emphasized.

In the realm of digital connectivity, Telkom is expanding its fiber-optic-based communication network, developing 5G signals, and managing two satellite transponders.

Regarding the digital platform, the company is actively constructing centers to enhance cloud data, big data, Internet of Things, cybersecurity, and a variety of products that facilitate financial transactions.

In terms of digital services, Telkom provides digitalization services across various sectors, including MSMEs, education, healthcare, and entertainment.

According to Databoks, Telkom reported revenue of Rp73.47 trillion in the first half of 2023, a 2.07% increase compared to the same period last year (year-on-year).

The majority of Telkom's revenue in the first half of this year came from the data, internet, and information technology services segments, totalling Rp43.42 trillion. Additionally, revenue from IndiHome reached Rp14.38 trillion, telephone services generated Rp5.70 trillion, interconnection revenue amounted to RP4.46 trillion, and other services contributed Rp2.92 trillion.

As revenue increased, Telkom also experienced an increase in expenses and costs. One significant expense was operational, maintenance, and telecommunication services, which increased by 7.41% year-on-year to Rp19.17 trillion.

As a result, Telkom's net profit attributable to the parent entity decreased by 4.16% to Rp12.75 trillion in the first half of 2023.