Publication Overview
This report provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Indonesia. Subjects covered include:
- Key statistics;
- Scenario forecasts (fixed, mobile, internet subscribers)
- Market and industry overviews;
- Regulatory environment;
- Major players (fixed and mobile);
- Infrastructure development – national and international;
- Digital media;
- Mobile voice and data market;
- Internet, including VoIP and IPTV;
- Broadband services;
- Regulatory environment.
Researcher:- Peter Evans
Current publication date:- May 2012 (18th Edition)
Executive Summary
Indonesia starting to embrace broadband on a grander scale
After a period of uncertainty, the Indonesian telecom sector has settled into a healthy development phase. This country of around 240 million people presents a huge potential market; however, it faces some particularly big challenges that need to be confronted if it is to successfully continue the building of the telecommunications infrastructure required to support a large population spread over what is a uniquely complex geography. At the same time, there is no avoiding the fact that Indonesia must also continue to deal with a range of social, political and economic issues that have proved problematic over the years.
The embracing of fixed-wireless technology, after an early stumbling start to building the country’s fixed-line network, provided a fresh basis for expansion. Wireless has now become the dominant component within the fixed market segment; by 2011 it made up 80% of the total fixed-line subscriber base. The introduction of fixed wireless has also seen a major upturn in fixed subscriber numbers with teledensity reaching 17% by early 2012. Wireless technology has not only boosted the growth rate in the last few years; it has provided much-needed basic telephone services to previously unserved communities. In a short space of five years this technology platform had transformed the fixed-line market.
Meanwhile, a strong mobile market (penetration of 107% in early 2012) was still short of what is generally regarded as saturation. While the global financial crisis saw growth in mobile subscribers slow somewhat back in 2009, the market did not lose much momentum overall. In the two years to December 2011 the mobile subscriber base grew from 150 million to 260 million. As penetration passed the important 100% milestone, there was still considerable potential for further growth in the market. Consumer interest has started to shift to the 3G services being offered by the operators and take up of mobile data services is certainly on the rise, as evidenced by a significant surge in the sale of smartphones in 2010/2011.
The number of internet users in Indonesia was estimated at 24 million by early 2012, representing a relatively low overall population penetration of 10%. At the same time, the internet subscription market was generally depressed with just four million subscribers reported by early 2012. Dial-up services had dominated the market up until recently, but the last 2-3 years has seen broadband development accelerate. So much so that broadband was suddenly was the majority form of internet access. Overall internet penetration remained low, however, and was a cause for concern. The expansion of mobile broadband was, nevertheless, offering hope to the internet market as uptake of new generation services accelerates.
Market highlights:
- Indonesia’s mobile market passed 260 million subscribers in early 2012 with penetration running at just over 107%;
- After years of strong growth, the annual increase in mobile subscribers had moderated somewhat by 2012 to somewhere around 15%;
- The 3G market had got off to a slow start, but by 2011/2012 there were sign of a surge in growth, with sales of smartphones jumping sharply;
- Internet user penetration remained low (10% user penetration by end-2011) and internet subscription rates were considerably lower;
- With broadband internet access numbers in Indonesia growing rapidly, by 2011 broadband as a proportion of the total internet subscriber base was running at almost 70%;
- DSL remained the dominant broadband platform for the time being; the heavy reliance on limited copper-wire infrastructure to access DSL services offers a huge opportunity for increased use of wireless-based internet access.
Indonesia: - key telecom parameters – 2011 - 2012
|
Category
|
2011
|
2012 (e)
|
|
Fixed-line services:
|
|
|
|
Total No. of subscribers
|
41.0
|
43.0
|
|
Annual growth (e)
|
8%
|
5%
|
|
Fixed-line penetration (population)
|
17%
|
18%
|
|
Internet services:
|
|
|
|
Total No. of fixed internet subscribers
|
4.0 million
|
5.0 million
|
|
Annual growth
|
33%
|
20%
|
|
Fixed internet penetration (population)
|
1.7%
|
1.9%
|
|
Internet household penetration
|
4%
|
5%
|
|
Mobile services:
|
|
|
|
Total No. of subscribers
|
259 million
|
300 million
|
|
Annual growth
|
18%
|
16%
|
|
Mobile penetration (population)
|
107%
|
122%
|
(Source: BuddeComm)
