2 Nov 2011Indonesia Broadband Overview

Until 1989, the Indonesian government had a monopoly in the telecoms sector. In 2000, policies governing the telecoms sector were amended in order to create a competitive environment for the entry of new telecom players. Internet services were first introduced commercially in Indonesia in 1994. Before 1994, Internet access was only available to a few universities and research institutes through ‘IptekNet’, the National Science and Technology Network.

With a total population of 245 million, Indonesia is the fourth largest country in the world by population, and is ranked as one of the top four telecom markets in terms of scale and development potential. However, Indonesia faces some big challenges if it is to successfully continue the building of telecommunications infrastructure needed to support its uniquely complex geography - an archipelago that spans over more than 16,000 islands.

The Internet is very much in its infancy and in mid 2011 broadband population penetration was just over 2 per cent. Problems with inferior telecommunications infrastructure have continued to impede broadband growth. However, growth in both subscriber numbers and revenue has taken place, and more importantly, there are signs that the changes in the regulatory regime and operator restructuring are starting to have a positive effect. Wireless broadband is increasingly popular among the youth market, and with 50 per cent of the population below 35, shows enormous growth potential. Fixed wireless services, aggressively rolled out by key operators, have been significant in boosting the growth rate over the last few years. With a mobile subscriber base of over 180 million by Q1 2011, and market interest starting to focus on 3G services, mobile broadband is also set for rapid growth in coming years - particularly as Indonesia is the number one twitter user and the number two facebook user globally.