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Indonesia - Telecoms, Mobile, Broadband and Forecasts

Indonesia telecoms market: Mobile penetration of 117% in early 2013

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2014-02-03 00:08:04 - Indonesia - Telecoms, Mobile, Broadband and Forecasts - a new market research report on

After a period of uncertainty, the Indonesian telecom sector has settled into what looks like a healthy development phase. This country of around 245 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. Two of the more significant challenges are the crowded operator market, especially the mobile segment, and the slow rate of implementing regulatory decisions. At the same time, on a broader front, 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 2012 wireless services made up 75% 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 16% early in 2013. 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 in a positive fashion.

Meanwhile, a strong mobile market (penetration of 117% in early 2013) was seeing a possible moderation in its growth rate. While the global financial crisis saw expansion in mobile subscriber numbers slow somewhat back in 2009, the market did not lose much momentum overall. In the three years to December 2012 the mobile subscriber base grew from 150 million to 280 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.

The number of internet users in Indonesia was estimated at 54 million by early 2013, representing a rapidly growing population penetration of 22%. At the same time, the fixed internet subscription market was generally depressed with just 5.5 million subscribers reported by end-2012. Broadband subscriptions are certainly growing but from a low base. The expansion of mobile broadband in particular was offering real promise to the internet market as uptake of new generation services accelerates.

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