Internet-online-web marketing indonesia

Commercial Internet services commenced in Indonesia in 1995. Coming into 2008, Indonesia had an estimated 25 million Internet users. This, however, represented only around 10% of the population. And broadband Internet services were still very much in their infancy. Problems with inferior telecommunications infrastructure were likely to continue to impede Internet marketing reach and growth in Indonesia. However, the country is considered to have enormous potential as an online market.

To understand internet marketing potential in Indonesia lets go through each of the following:
1 Internet Penetration
2 The Net Revolution
3 A Broadband Overview
4 Personal Computers and Being Online
5 Warnet
6 Profile of Indonesians Online
7 Regulations & Internet Governance Initiatives
8 Future Developments
9 Web 2.0 & Indonesian Youth

1 INTERNET PENETRATION (for better understanding internet marketing reach and potential in Indonesia)

Table 2A: Comparison of Internet usage
Number of Internet Users
Population Size
Percentage of Internet Penetration
Gross Domestic Product per capita*
Top Local Sites Visited
Top Global Sites Visited
Usage Source
1.0 %
US$ 570

8.9 %
US$ 1,280
Detiksport, Detiknews, Kaskus, Kompas
Yahoo, Friendster, MSN, Google, YouTube, MySpace, Baidu

Note: Per Capita GDP in US dollars, source: United Nations Department of Economic and Social Affairs.

Largely due to its poor Internet infrastructure and vast expanse of rural areas, Indonesia's Internet penetration was a mere 9% in 2007 which limits the reach of internet marketing.


Many referred to the 1998 overthrow of Suharto as the Net Revolution. Merlyna Lim, Professor at Arizona State University School of Justice and Social Inquiry, did a case study on the event and concluded that the Internet played a significant role in creating a network of political activism that led to the political revolution. However, it did not play a direct role.

"What the Internet did provide was an opening for political activism to, first, break through the barriers of state monopoly over the production of knowledge and flows of information and, second, to reach a national and even international audience through the cascading of information from the Internet to people on the street using other media technologies. In the case of Indonesia, through successful popular movement, made possible through openings created by the Internet, other ‘more traditional’ media could also at last play their roles in giving voice to the ‘people’. These more traditional media were also changed by their linkages with the Internet. They were renewed and given new meanings and new values," said Professor Lim

Source: Transcript from Merlyna's public lecture as part of the Association of Internet Researchers conference,held in Brisbane, Australia, from September 27-30 2006, entitled Democracy, Conspiracy, and Pornography: Politics of the Internet in Indonesia, explored the social history of the development of the Internet and its uses in Indonesia.


The two key players in the broadband market of Indonesia are are PT Telkom and PT Indosat.

Until 1989 – Indonesian government had monopoly in the telecoms sector
Before 1994 – Internet access was only available in universities and research institutes
1994 – Internet services were introduced commercially
2000 – Governing policies were amended to create competitive environment for entry of new players
2004 – IndoNet became the first commercial operator to launch ISP services
2005 – 124 ISP operating in Indonesia and 41,500 Broadband Subscribers, Internet users reached 12 million
2006 – Third country after Singapore and Malaysia in Southeast Asia to launch 3G commercially. 2007 – 20 million internet users(8.9% penetration), 194, 400 broadband Internet connections (as of Dec.31/07, per ITU) and 20 million mobile subscribers (20% penetration)
2010 – Internet users expected to reach 80 million
(forecast by Ministry of Communications and Information Technology)

Source: Point topic


PC penetration in Indonesia is of lesser significance than other countries in South East Asia. PCs are mainly found in urban areas used for commercial and business purposes both at homes and in the offices.

However, PC penetration is not relative to the number of internet users. The number of PCs in Indonesia is much lower than the number of internet users due to the lifestyle of the Indonesians. Many of them are occasional internet users and find it more economical to share or rent PCs than owning one. This is an important fact one should understand before structuring any online marketing strategy for the Indonesian market.

Table 2B: Household PC Penetration and Internet Usage; 2003-2005

Online households (million)
Internet users ('000)
PC penetration (per 100 households)
PC households online (% of PC households)
Source: National Statistical Office, International Telecommunications Union, World Bank, Trade sources, Jupiter Research, Euromonitor International


Majority of the Indonesians turn to the Warnet, a short form for Warung Internet, as an alternative to owning a PC. The Warnet functions like an internet café whereby people can surf the Internet, use the business applications for work purpose or even engage in internet gaming for entertainment purposes. With the increasing number of Warnets and internet service providers, the number of internet users in Indonesia is also increasing at a fast rate. As the Warnets offer a cheaper rate due to their operation from cable instead of a dial-up connection, it is often popular with the lower income people. The middle to upper higher income people will usually have their own PC and subscription to an internet service provider.

Source: Euromonitor international


Any internet marketing plan should resonate with the kind of audience it is meant for. Hence, it becomes all the more important for us to understand the profile of the online Indonesians in order to give them exactly what they are looking from our internet marketing activities. In many countries, it is evident that the Internet is dominated by males. According to Professor Merlyna Lim, internet in Indonesia, up to 5 years ago, was also dominated by males. They were mainly highly educated and belonged to the middle class and upwards. She mentioned that a recent trend is that there are increasing female internet users and they are much more productive than the male users. Female internet users also blogged more frequently. This clearly demonstrates how evolved the internet users in Indonesia are and how important it is to use the latest possible internet marketin tools to market your offerings.

"There are more and more young, female, Muslim housewives who stay home, and they are starting to be networked through the Internet, " said Professor Lim.

Source: Transcript from Merlyna's public lecture as part of the Association of Internet Researchers conference, held in Brisbane, Australia, from September 27-30 2006, entitled Democracy, Conspiracy, and Pornography: Politics of the Internet in Indonesia, explored the social history of the development of the Internet and its uses in Indonesia.


It is important that no internet marketing effort should overlook the leal regulations of Indonetia. There is absolute freedom of expression on the internet. The government till date only regulates the distribution of pornographic content via the internet. A law was enacted in early March 2008 to make using or posting a pornographic website punishable by up to three years in jail. Anyone caught violating the law can be fined up to 1 billion rupiah. Minister of Information and Communication, Muhammad Nuh said that the law will avoid the negative impact of the misuse of information technology.

Mr Nuh also said that the law was enacted to protect young internet users. Internet users are expected to double to 50 million following a programme launch which will give high school seniors free internet access in April 2008.

Many however questioned the effectiveness of the new law. Internet cafe owners said that there are too many ways to go around the new law and people will continue to surf online pornography at the cafes. Critics also mentioned that the law did not give an obvious definition for "pornography", therefore will not be as effective as it is supposed to be.


Premium Indonesia broadband Internet service provider, Biznet, announced recently on its collaboration with Switch and Data to improve internet performance and broadband experience for Indonesia Enterprise and Residential Customers. Public and private peering agreements have been made. This will enable higher efficiency of access of foreign websites from Indonesia. This initiative is in line with the growth of web2.0 in Indonesia. With better infrastructure, Indonesia would be better connected with the rest of the world.


How effective would Web 2.0 marketing tools be in Indonesia? How can products marketing reach the Gen Nxt of Indonesia? Lets find out.... A recent research by Synovate showed that the Internet and mobile phones have changed the lifestyle of youth in Indonesia. Out of the 20 millions internet users in Indonesia, close to 40% are aged between 20 and 24. These youth want to be different and can adapt to changes in technology rapidly.

The hot favorites of the youth in web 2.0 are online games, Avatar, Frienster, Myspace and blogs such as Wordpress. With the Internet, Indonesian youth are growing to be like other youth in other parts of the world. Yanti Sugarda, Managing Director of the Polling Center said that these youth obtain information on latest fashion and entertainment worldwide via the Internet. The same applies to businessmen and young executives as they start to communicate and work in a similar style as other people worldwide.