Mobile nation

By webadmin on 11:58 am Sep 27, 2011
Category Archive

Yanto Soegiarto

With a gargantuan population and the lowest levels of internet penetration in the region, Indonesia has the most promising telecommunications market in Asia. As the archipelago gets increasingly connected. Analysts expect it will soon be the world’s fourth-largest mobile market.

Indonesia’s mobile and internet penetration rates are as low as 62.7% and 1.1% respectively, significantly lower than its neighbors. In Singapore, the figures are as high as 129.4% and 98.4%, while in Malaysia mobile penetration is 94.8%.

Indonesia’s low fixed-line proliferation, with only 30 million fixed and fixed-wireless subscribers, has accelerated mobile substitution and expansion with an average growth of 50% between 2003 and 2008.
Indeed, by the end of 2009 Indonesia’s mobile subscribers totaled 143.6 million.

The positive growth trend is likely to continue in the double-digits this year and by 2013 Indonesia will become the fourth-largest mobile market in the world market behind China, India and the United States.

The number of people flocking to the web is also picking up speed. With a minuscule internet penetration rate of just 1.1%, there is massive room for growth. Any savvy telco operator is now scrambling to focus on developing high-speed networks, including wireless broadband. By the end of 2013, broadband services are expected to connect more than 90% of all internet subscribers.

A recent Nielsen digital report showed that Indonesia has emerged as the country with the highest dependence on mobile internet access in Southeast Asia, with almost half of all citizens logging on via their cell phones.
The report, which contains data from Nielsen’s Southeast Asia Digital Consumer Report, showed that 48% of internet users in Indonesia had used a mobile phone to access the internet, while another 13% used other hand-held multimedia devices.

The “leapfrog” trend, in part due to poor telecommunications infrastructure in the regions, is set to continue deepening rates of internet penetration through cell phones and handheld devices.

The percentage of Indonesians using their cell phones to access the internet far surpasses those in other countries in the Southeast Asia region. Directly behind Indonesia is Thailand with 36% and Singapore with 35%. Vietnam comes in fourth in the report with 29%, while the Philippines and Malaysia follow with 24% and 21% respectively.

For the majority of Indonesians, around 66%, internet cafés are the favored location to access the internet, while regionally the internet is predominately accessed from home. Only 19% of Indonesians surf the web from home, 22% from the office and 14% from school or university.

Indonesia’s largest telecoms operator PT Telekomunikasi Indonesia Tbk. (Telkom) has allocated 40% of its 2011 capital expenditure on the development of broadband during the first quarter of 2011, or a total Rp17 trillion.

“About half of that money is being spent on broadband infrastructure for both Telkom and Telkomsel,” says Telkom’s finance director Sudiro Asno. “The rest is for access, supporting facilities and modernizing our equipment,” he adds, noting that Telkomsel subscribers have now reached a new record of 104 million.

National priority

The government predicts that more than 50 million people will be able to access the internet this year, as the nation pursues its drive to connect the nation online. 

And every telco operator is vying for a share. Predicting that voice and SMS services will soon stagnate, operators are shifting their focus to improving their broadband data services. The saturated market for calls and SMS points to greater business opportunities in broadband.

While the number of new voice and SMS subscribers will inevitably decline, the growth of data subscribers is expected to surge.

PT Indosat Tbk., the country’s second-ranked telecommunications company, is getting on the train with the introduction of its Indosat Internet and the Indosat Mobile retail broadband services packages which offer more choice for high-speed internet access.

With the second-largest number of users globally, Indonesia’s Facebook fanaticism points to the country’s strong online potential. More than 25 million Indonesians are on the social networking site with a large number far from its metropolis center.

Wireless broadband access is currently supported by technologies such as 3G, Evolved High-Speed Packet Access (HSPA+), WiMax, Long-Term Evolution (LTE) and Smartfren’s EVDO CDMA, which promise to deliver much faster download speeds, and increased data storage.

LTE, a new high-performance wireless interface for cellular communication systems, will enable download speeds of up to 100 megabytes per second, about six times the current speed of 3G.  GA