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Indonesia – Telecoms, Mobile and Broadband – Statistics and Analyses : Researchmoz

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Indonesia still faces some big challenges 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. Continued progress in the development of the telecom sector will need further government action on restructuring the industry.

Indonesia is ranked 17th on the Asian Telecoms Maturity Index with an Index score of 33. Indonesia is also ranked 10th in the ‘Market Challengers” category out of 16 countries. (BuddeComm’s “Asian Telecoms Maturity Index”, is an index (on a scale between 0 and 100) that measures and ranks the relative maturity of the telecoms industry in all of the 34 countries in Asia.) Compared to other Asian nations, Indonesia has very low fixed line and fixed broadband penetration, high mobile penetration and moderate mobile broadband penetration.

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Fixed broadband penetration in Indonesia remains relatively low mainly due to a limited number of fixed lines and the dominance of the mobile platform. The fixed broadband market has grown slightly over the past five years from a very small base. Over the next five years to 2022 moderate growth is expected to continue  from this very small base.

4G mobile services offering mobile broadband is now relatively advanced in Indonesia and act as a direct substitute to fixed line broadband. This also inhibits  further fixed broadband rollouts. Mobile broadband subscribers have grown rapidly over the past five years in Indonesia. Strong growth is predicted over the next five years to 2022.

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Not only is wireless-based mobile broadband helping to get more people online; it is also bypassing the problem of inferior telecommunications infrastructure that has been impeding fixed broadband expansion.

Indonesia’s mobile market has displayed very strong growth over the last five years and particularly during 2016 to 2018. Growing use of mobile broadband has been a significant driver of this strong growth. The market has seen a strong increase in subscribers from the market leader Telkomsel, supported by very strong growth from XL Axiata and Indosat Ooredoo.

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Industry consolidation is possible towards 2019 as intense data competition may force smaller and unprofitable mobile operators to be pushed out of the market. Industry consolidation is more likely to have a positive impact on the local telco sector as it will reduce the overcapacity in the market and bring more stability to data tariffs.

Mobile subscriber growth is expected to be relatively low over the next five years to 2022 as the market further matures in a highly competitive market. The market will be driven by the uptake of both 4G and 5G services.

Key Developments

– Indonesia is ranked 17th on the Asian Telecoms Maturity Index with an Index score of 33.
– The fixed line market (wireless and wireline) continues to suffer setbacks with a rapidly declining subscriber base.
– The fixed broadband market has grown slightly over the past five years from a very small base.
– 4G mobile services offering mobile broadband is now relatively advanced in Indonesia.
– Telkomsel and Huawei held a live demo of 5G technology in Jakarta, which they claim is capable of producing data speeds of up to 70Gbps.
– Industry consolidation is possible as intense data competition may force smaller mobile operators to be pushed out of the market.
– Strong growth is predicted over the next five years to 2022 for the mobile broadband segment.

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Key companies mentioned in this report:

PT Telkom; PT Indosat; Bakrie Telecom; PT Satelindo; ThaiCom. PT Telkomsel, Temasek, TelkomNet, Telkomsel.

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