With 138 million mobile users in Indonesia, the market presents a huge opportunity to operators and service providers alike. Bakrie telecom, one of the leading CDMA brands in Indonesia, is one of those carriers cashing in on the country’s mobile hype.
Bakrie boasts that it already counts 13 million subscribers across 88 cities in the Indonesia archipelago and has sold 10 million phones over the past three years alone.
The firm has built its brand by pushing the envelope when it comes to making mobile affordable, as well as its promise of YouTube streaming without buffering, thanks to a current abundance of capacity.
Speaking at an MEF event in Singapore last week, Erik Meijer, Bakrie’s deputy president director explained how mobile in Indonesia was leapfrogging voice and SMS and moving rapidly towards social networking, search, chatting, email, downloading content, online games and blogging – a phenomenon seen in much of the first world too.
Indonesia is the 2nd largest country on Facebook with 35 million users and counting, meaning Facebook dominates mobile internet usage in Indonesia.
8% of Bakrie’s subscribers partake in some form of online gaming experience, said Meijer, though music is a core mobile driver too.
Over 85% of phones currently sold in Indonesia are MP3 devices, though until recently, much of the music being played on the devices was pirated. This was causing a significant amount of angst to the music industry, which then made the decision to push for revenues more in the ringtone and subscription radio space. So far, according to Meijer, this seems to be working well.
“When it comes to value added services (VAS) like music, we try to use a similar strategy to that of drug dealers,” he said explaining, “give the product to people for free initially and then start charging once they’re hooked.”
VAS does indeed appear to be a good business model in a country where 75% of the phones sold are now internet capable and where 20% of all units sold are smartphones.
“Buying power in Indonesia is going up,” said Meijer, noting that RIM’s BlackBerry was still the number one selling device on the Indonesian market, mainly thanks to the national obsession with BlackBerry messenger.
“If you don’t have BlackBerry messenger, you’re not hip,” said Meijer adding that the most common question asked in the country was “what’s your PIN?”
Despite RIM’s stronghold, however, Android phones are starting to see breakthroughs in Indonesia and are beginning to see some rapid growth. “We do feel it’s going to be a huge growth product,” said Meijer, especially when it comes to the $100 Android devices beginning to hit the market which he described as a “good price point.”
Apple’s iPhone on the other hand, has fared miserably in the market, having been launched with just one carrier at a price inaccessible to the majority of consumers. By contrast, however, the iPad is growing in popularity, which in turn is spurring demand for the iPhone, which is now also available to other operators.
Bakrie has also launched its own “Islamic Phone” to cater to the country’s majority of Muslims, with specialized value added services such as prayer time alarms and downloadable Koran readings, which has proved a resounding success with over a million sold so far.
Innovation doesn’t stop there for the Indonesian operator, either, with all kinds of experimentation going on when it comes to price points for services like SMS. Bakrie has recently started charging its customers per character for SMS messages, rather than a fixed rate per message, which Meijer claims is cheaper for most people, who don’t use the full 160 characters.
All in all, Meijer believes his firm is on the right track when it comes to closing the mobile digital divide in one of the world’s largest markets, and will continue pushing the envelope even further over the coming months and years.
