At a time when Indonesia is looking forward to an era of digital transformation – Communic Indonesia 2016 is all set to drive the country towards creation of a robust digital economy and ecosystem that would not only contribute to the improvement of citizen’s lives of the most populous nation in Southeast Asia, but also facilitate favourable business environment to increase global competitiveness for sustained economic growth.
Victor Wong, Project Director, Communic Indonesia talks with Zia Askari from ChannelDrive.in about this special event in Indonesia and how it is likely to change the face of ICT there.
How important is ICT enablement for a country like Indonesia?
Digital transformation in Indonesia is poised to have a significant socio-economic impact. A robust digital economy and ecosystem would not only contribute to the improvement of citizen’s lives of the most populous nation in Southeast Asia, but also create a favourable business environment to increase global competitiveness for sustained economic growth.
Mobile penetration and access tobroadband services would connect the population of 250 million spread across 17,500 islands, and allow e-services across many industries. This will aid in improving accessibility, productivity, efficiency, as well as bridge the gap between the urban and rural population.
According to Indonesia’s Ministry of Cooperatives and SMEs, the country has 57.89 million SME ‘business units,’ or approximately 99.99% of the total number of businesses. Enhancement of ICT capabilities of local small and medium enterprise (SMEs) – the country’s largest employer and contributor to 59% of the country’s GPD, would reap huge benefits and open up new markets both domestic and abroad.
In a report by Deloitte Access Economics, it stated that if Indonesian SMEs were to be empowered via digitalisation, the county’s economic growth would see a 2% increment. The report noted that Indonesia’s economy has been averaging 5% growth per annum. To meet its target of becoming a middle-income country by 2025, it needs to hit GDP growth of 7% – a target that can be achieved with what it describes as ‘SME digital engagement.’
How can ICT led digital enablement of businesses and masses increase productivity and profitability?
As a greater proportion of the population comes online in Indonesia, governments and local enterprises are looking to harness the potential of an increasingly upwardly mobile middle class. Not just to increase productivity, and improve efficiency, they are also looking to increase profits by recognising the huge commercial value that comes with access to an engaged online mobile population.
With the better mobile and internet coverage, enterprises can look forward to more solutions targeted at enterprise mobility, transportation, e-commerce and cybersecurity. Citizens also benefit from more e-government services.
Traditional brick and mortar business such as retailers are increasingly coming online, with e-commerce shopping platforms such as Tokopedia and Lazada thriving in this new market. Greater online mobile access has also transformed traditional industries such as transportation, with the introduction of Go-Jek and GrabBikeproving to be hugely popular.
What are the key objectives and focus for Communic Indonesia ? How is this event positioning as a platform to enable ICT growth in Indonesia?
Communic Indonesia will address and showcase the latest issues and opportunities of the Indonesian market, and how to further spur the development of Indonesia’s digital economy and ecosystem.
The event will give key decision makers of the ICT and business world in Indonesia access to the best and most innovative ICT solutions from top international ICT brands and suppliers to enable digital transformation of enterprises in Indonesia.
In addition, it will also enable decision makers to harness innovations to chart out ways on how technology can transform the lives of its citizens. This includes mobile connectivity and broadband connection as well as the use of satellite communications and services to provide up-to-date news and entertainment to the country’s many islands, and the increased use of rural connectivity to spur development and better lives of all Indonesians.
Increasing number of citizens coming online via mobile with rapid adoption of 4G/LTE services
In Indonesia, majority of growth of internet user base is driven by mobile. It is estimated that mobile internet users will increase from 55 million users in 2014 to an estimated 84 million this year.
Smartphones, which are the preferred way of accessing the internet and content is also seeing strong adoption rates. As of 2015, Indonesia has over 52 million smartphone users and the smartphone user base in the country is growing at a CAGR of almost 35%, going up from 38 million in 2014 to an estimated 69 million in 2016.
In July 2015, Indonesia’s five biggest cellular operators (Telkomsel, PT Indosat, XL Axiata, Hutchison’s 3 and Smartfren) launched their 4G LTE services.
SmartFren targets to secure five million subscribers by the end of 2016 and expand its service coverage from 22 to 85 cities. Indosat currently operates 4G/LTE services in 27 cities nationwide, and said it would expand to 14 more cities throughout 2016. In the third quarter of 2015, Indosat saw data usage traffic grow by 155 percent from the same period in 2014.
The increased proliferation of 4G/LTE services among the young middle class, has a ripple effect to give rise to emergent trends such as:
The surge of E-commerce
The finalisation of Indonesia’s e-commerce roadmap was just announced on 18 Jan2016 by the Coordinating Ministry on Economy. According to the Indonesian E-commerce Association (idea), Indonesia’s e-commerce industry is projected to rake in Rp 20 trillion ($1.46 million) in 2016, double 2015’s estimate of Rp 8 trillion to Rp 10 trillion.
How can companies in India and SAARC region benefit by participating in Communic Indonesia?
Indonesia is Southeast Asia’s biggest market, with a population of 250 million. Building a robust digital economy and ecosystem sits high on the list of government agendas, and their efforts have spurred a recent rapid adoption of mobile and online services by both consumers and businesses.
As the industry is still nascent, there is massive market potential for tech services providers from the region. With its close proximity to Indonesia, the companies in this region can showcase their capabilities to tap on the many possibilities presented by the Indonesian market at Communic Indonesia. They can also look forward to forge partnerships with local companies as an efficient way to enter the market.
