Indonesia poised for a Digital media boom

March 12, 2022 5:09 pm0 commentsViews: 2

Among emerging markets, Indonesia often falls into the long shadow cast by Brazil, Russia, India and China—also known as the BRIC countries. But Indonesia—with the fourth-largest population in the world—is growing rapidly, as is its online population, according to a new eMarketer report, “Indonesia Online: A Digital Economy Emerges, Fueled by Cheap Mobile Handsets.”

Indonesia’s economic engine will help create a new and considerable digital class of consumers. eMarketer projects about 29% of the population—or 72.7 million people—will have access to the internet by the end of 2013. That penetration rate is expected to climb to 39.8% by 2016, accounting for 102.8 million internet users.

Other estimates vary due to different methodologies. For example, some estimates do not include usage outside of the home or office, which may discount a large number of users accessing the internet in shared places such as internet cafes. Accounting for variations such as this and the age ranges studied, other firms’ figures are in line with eMarketer’s.

Internet use remains heavily concentrated in Indonesia’s largest cities, where people are more able to afford both internet-enabled devices and service plans. A MarkPlus Insight survey released in November 2012 estimated that, out of a total internet user population of 61.1 million in 2012, 56.4 million lived in urban areas.

How does the population go online?

Fixed broadband remains a rarity in Indonesia, with a penetration rate of about 1.6% of households, or 800,000 homes.

A significant impediment to fixed broadband access is that many people in Indonesia simply can’t afford it, along with the logistical difficulty of providing internet across a geographically fractured area. While the government is taking steps to improve broadband access, as in most developing economies, growth in internet access will largely come through the adoption of internet-enabled mobile phones.

Smartphone adoption is still in its early phase, with eMarketer projecting that smartphone users will account for 24% of all mobile phone users by the end of 2013. But the mobile landscape is changing quickly; cheap smartphones made in China have substantially lowered entry costs for many consumers seeking regular internet access for the first time. According to eMarketer estimates, smartphone penetration among mobile phone users will climb to 47% by 2016—a total of 87.4 million users.

Although the mobile device trend is clearly shifting toward smartphones, internet-capable feature phones remain an incredibly popular means of getting online. When Yahoo! and TNS Global asked mobile internet users in urban Indonesia which devices they used to go online, 86% said they used feature phones, compared with 20% who used a smartphone and 7% who used a tablet.

As for what internet users do online, internet usage in Indonesia is still in the early phase: Communication and information gathering are popular—with social media figuring strongly into the online behavior of internet users. Social networks are an indelible element of the online world in Indonesia and a reflection of the social nature of the country’s culture.

Source: eMarketer


Leave a Reply