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21 Feb 2025
Insight
Indonesia
In today’s era, where fast and low-latency networks are essential, the need for robust connectivity is more critical than ever. As 5G deployment in Indonesia has not reached its full potential, our Jakarta office hosted an insightful panel discussion, "Indonesia 5G: Navigating the Future of Connectivity."
The event aimed to explore the opportunities and challenges ahead, bringing together key industry leaders and stakeholders, including representatives from the Indonesian Ministry of Communications and Digital Affairs (MCDA), the Telecommunication Providers Association of Indonesia (Asosiasi Penyelenggara Telekomunikasi Seluruh Indonesia or ATSI), the Telecommunication Network Providers Association (Asosiasi Penyelenggara Jaringan Telekomunikasi or APJATEL), and the Association of Submarine Cable Communication Systems Providers of Indonesia (Asosiasi Penyelenggara Sistem Komunikasi Kabel Laut Seluruh Indonesia or ASKALSI).
Key Takeaways from the Discussion
Current State of 5G in Indonesia
Indonesia lags behind its Southeast Asian neighbours in 5G deployment, including on spectrum allocation. Since its rollout in 2021, Indonesia currently ranks 9th out of 10 ASEAN countries in mobile and fixed broadband performance. The country’s 5G spectrum utilisation remains limited to 1.8GHz/2.1GHz/2.3GHz while cellular operators are waiting for the government to release additional spectrums in the 700MHz, 2.6GHz, and 3.5GHz bands. Despite these limitations, mobile broadband quality has steadily improved in recent years.
Challenges in 5G Development
In addition to the need for additional spectrums for 5G deployment, telecommunications providers in Indonesia face high costs for spectrum and other telco infrastructure, operations, marketing, and services. A significant and disproportionate burden comes from regulatory costs, with operators taxed significantly higher than in neighbouring countries. The discussion also explored on how cellular operators can navigate the high regulatory cost, such as sharing cost with OTT providers, MVNO business model and spectrum sharing arrangement. Additionally, fiber optic and subsea cable infrastructure optimisation—a crucial component for 5G deployment—remains a challenge. Overlapping regulations and complex coordination across multiple government agencies further slow progress. Industry leaders emphasise the need for a more streamlined licensing process to accelerate fiber optic and subsea cable deployment and improve network expansion.
Future of 5G in Indonesia
To address these challenges, MCDA is developing various policies, including acceleration of 5G spectrum release, fiberisation roadmap, and affordable and high-quality internet program for public and formulating incentive policies for digital infrastructure industry and ecosystem.
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