Indonesia is the 3rd-Largest Smartphone Market in the Asia Pacific

According to the latest report from eMarketer, the number of smartphone users in Indonesia will rise from 55 million in 2015 to 92 million in 2019. Currently Indonesia has already become the third-largest smartphone market in the Asia-Pacific region (after China and India). The research firm added that the total number of smartphone users in the Asia Pacific has exceeded one billion users.

Meanwhile, Lee Kang, the Vice Chairman of the Indonesian Cellular Phone Association (APSI), said the number of smartphone users in Indonesia has been growing between 30 and 50 percent each year and this growth momentum will remain intact due to the availability of affordable 4G smartphones on the Indonesian market and further development of Indonesia's 4G network. Indonesia's expanding middle class is increasingly using smartphones in their daily activities, including e-commerce, video calling and streaming. This is also part of a new lifestyle, particularly in the urban regions (over the last forty years Indonesia has been experiencing a process of rapid urbanization). Kang adds that within two years he expects the majority of Indonesians to use smartphones.

Tjandra Lianto, Marketing Manager of Advan Mobile, says each year a total of 4.5 million smartphones are sold in Indonesia. He expects this figure to rise in the foreseeable future due to expectation of an accelerating Indonesian economy and improving purchasing power of consumers. He adds that the smartphone has become a vital tool for the Indonesian consumer for the storage of various data, both personal and corporate data.

However, he also says that - compared to the advanced nations - smartphone usage in developing countries such as Indonesia is still low as the majority of the people are still not aware of all features and applications offered by the smartphone (they have yet to adopt a new lifestyle in which online activity plays a major role). The majority of these people are still focused on voice and text messages.

Data from the International Data Corporation (IDC) show that South Korea-based Samsung is market leader in Indonesia's smartphone market controlling a 24.8 percent share, followed by Taiwan-based Asus (15.9 percent market share), Indonesia-based Smartfren (10.8 percent), Advan (9.6 percent), and China-based Lenovo (6.5 percent).

Smartphone expansion in Indonesia is also supported by the government's plan to develop an information highway with broadband services for all 514 regency and municipal capital cities across the country by 2019 (through the Palapa Ring project). This project involves the development of 11,000 kilometers of undersea fiber-optic cables, divided into three sections: (1) west, (2) central and (3) east. Whereas 4G markets in advanced economies such as the USA and Japan have become saturated, Indonesia still offers a new and attractive market for 4G technology. After India and China, Indonesia has the highest amount of citizens who are not connected to the Internet. 

Smartphone Growth in the Asia Pacific:

Number of Smartphone Users (in million)	2015	2016F	2017F	2018F	2019F
China	525.8	563.3	599.3	640.5	687.7
India	167.9	204.1	243.8	279.2	317.1
Indonesia	55.4	65.2	74.9	83.5	92.0
Japan	51.8	55.8	58.9	60.9	62.6
South Korea	33.6	34.6	35.6	36.5	37.0
Philippines	26.2	29.9	33.3	36.5	39.2
Vietnam	20.7	24.6	28.6	32.0	35.2

^{Source: eMarketer}

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