JAKARTA, Indonesia,
Feb. 28, 2015 /PRNewswire/ --
Indonesia is the largest economy
in ASEAN and a member of G-20 major economies. The country's GDP in
2025 is projected to reach US$3.1
trillion, making it the 10th largest economy
globally. Mr. Ajay Sunder, Vice
President, ICT Practice, Frost & Sullivan Asia Pacific said
that Indonesia's top 5 provinces
are expected to contribute 60% of its GDP in 2020, with
Jakarta alone contributing
15.5%.
Mr. Ajay Sunder said the
enterprise service market in Indonesia is expected to reach $3.86 billion by 2019 at a CAGR of 18.6%. Mr.
Sunder is optimistic on growth in the enterprise services market
due to improved infrastructure, stable and growing economy and the
increasing number of ICT personnel in the workforce.
He said the Indonesian market is beginning to see good adoption
of shared services, and outsourcing managed services will be a
big segment driven by Indonesian enterprises increasing their
footprints both domestically and internationally.
Overall, enterprise solutions are expected to reach $820 million by 2019 at a CAGR of 17.5. "ERP
solution is the biggest segment within Business applications driven
by adoption from Manufacturing firms and fast-growing medium-size
enterprises," he added.
Mr. Ajay expects enterprise connectivity to reach $1.12 billion, with ethernet as the biggest
segment primarily driven by large enterprises looking for
International connectivity.
Mr. Sunder said that within cloud, SaaS will be a significant
market accounting for 88% of the cloud market and its expected to
remain fragmented with lots of niche players offering specialized
software on cloud.
He added that data center services is expected to reach
$263.9 million by 2019, with
co-location to account for 85% of the estimated revenues.
Telecoms Overview
Mr. Spike Choo, Associate
Director, ICT Practice, Frost & Sullivan Asia Pacific said that
low cost smartphones are driving the data demand in the Indonesian
market. This is fuelling the OTT ecosystem and he expects more mega
funding deals for local players in 2015.
A few budget devices will lure users to OTT ecosystems, for
example Google Chromebooks, Xiaomi, Coolpad for Computers &
Smartphones, Amazon Fire TV, Android TV, Xiaomi TV, Mi Box for media streamers and Xiaomi MiBand,
Misfit Flash, Pivotal Tracker for wearables, he added.
Mr. Choo also said that OTT ecosystems will expand to adjacent
sectors to extend user experience; Eg
Apple iWatch, Samsung VR Gear, XiaoMi TV.
Mr. Choo also said that online shopping continues to gain
traction as shopping experience improves making eCommerce and
mCommerce usage gain traction supported by infrastructure build out
& well-funded startups.
Further, he said that the operator revenue will remain
challenging, with more connections expected but lower ARPU
contributing to slower revenue growth. He added that operator
revenue continues to lag global average inflation rate of 4%, while
apps, content and advertising is forecast to grow strongly.
Mr. Choo said that mobile data traffic growth is projected to
grow strongly due to M2M and budget smartphones. He also said that
fixed data traffic (including WiFi) will remain the primary mode
for online video and music streaming, gaming, browsing, SNS and
others.
Rise of the Digital Consumer
Mr. Sunder said that Indonesia
will have around 1.7 billion connected devices in 2020 with over
470 million mobile subscribers and over 200 million active internet
users.
"Indonesia, which is currently
the fourth largest Facebook market, will continue to expand its
social media community with nearly 104 million social network users
expected to join the community by 2015," Mr. Ajay said.
Internet of Things, Big Data & Cloud market
potential
Banking, Financial Services and Insurance will continue to be
the biggest spender on ICT services while Manufacturing and
Transportation will show steady growth with respect to adoption of
ICT services.
Mr. Ajay Sunder said that managed
services especially managed network services will drive the
government spending. "The concerns around security and resiliency
are also expected to drive government demand for data connectivity
services especially disaster recovery," he added.
He also said that cloud based services, enterprise software and
connectivity services will drive demand in Logistics &
Transportation due to public infrastructure projects such as MRT
& BRT development.
He added that cloud based services will also be driving the
demand in Education driven by MICT new policies on Education and
specific initiatives like smart school.
Further, he said that other important segments will be
Healthcare, retail & hospitality, media & entertainment as
domestic consumption and rising middle-class spur growth in ICT
adoption among SMEs.
The Way Forward
ASEAN Economic Community (AEC) will be an immediate opportunity
for Indonesian ICT value chain players. AEC will usher more foreign
direct investments especially in infrastructure, spending in both
public and private transportation. The ability to be more
attractive for FDI based on tax incentive will be ended and
corporate tax rates difference will also disappear. "There will be
lots of opportunities for Indonesian Service Providers and value
chain players to participate in both domestic and regional
opportunities," Mr. Sunder said.
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Media Contact:
Shena Agusta
Corporate Communications – Indonesia
P: +6221 571 0838
F: +6221 571 3246
Email: shena.agusta@frost.com
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SOURCE Frost & Sullivan