Overview on Internet Use in Indonesia
Internet literacy in the country shows growth in the last decade.
From only 1% of the population in 2000, the number of internet usage
took a leap in 2007 to 8.9% and keeps increasing to 12% in 2010.
[3] From relying on
Warung Internet (Internet
Café) to access internet in the beginning of internet use in Indonesia,
nowadays, users also get internet access at work, home, and
universities. However, in contrast to other countries in South East Asia
where 67% users get internet access from home, 66% Indonesians still
rely on
Warung Internet due to
the lack of
high speed internet at home. An interesting trend is the increasing
reliant on mobile internet, where according to Ac Nielsen Survey in
2011, 48% internet users in Indonesia use mobile phones to access
internet. The number will climb to an additional of 5% within 12 months.
[4]
In public sector, the use of internet in public administration for better services to public was initiated in 2001 with
e-Government concept following the enactment of the Presidential Directive No 6/2001 on Telematics.
[5]
In private sector, internet use for commercial purposes has been
increasingly popular in the country since the introduction in 1995.
[6]
However, the percentage is less than the use of internet in general.
There are only 21% online consumers aged >15 years old and only 1%
above 50. Many Indonesians use internet for social networking purpose,
like Facebook (7.8% of population or 63.15% of total Facebook online
users)
[7] and Twitter (20.8% of population).
[8]
E-Commerce in Indonesia
Looking at the numbers above, one question might be how big is the
potential of Indonesia for e-commerce market? According to a survey
conducted by Daily Social in 2011, Indonesians still show hesitation to
use internet for commercial purpose. Among respondents in Jakarta,
mainly students, aged 20-30, 38% (244 respondents) use internet to check
and compare price and finally purchase the product online.
Recommendations from friends and family are still a decisive factor for
doing online transaction (60%).
[9]
Whether recommendation from friends in the social network plays a
role and if it does, how big the influence is, is subject to further
studies. However, it makes sense to see the tendency to use Facebook,
for example, to promote a product. Maybe, it will not contribute
directly to online purchase, but it helps to create awareness within the
network about the existence of the product.
Challenges
Some challenges are indicated as homework to be done to support the
growth of e-commerce in Indonesia. First of all is the lack of reliable
and affordable internet connection that enables users to conveniently do
online transactions. Losing internet connection while doing the
payment, for example, is the last one wants to happen. Internet speed is
also a concern for consumers.
Another problem is the payment method. Whilst users can browse
products and compare prices over internet, online payment is not always
possible to do. Bank account transfer and cash on delivery are still the
main payment methods being used.
[10]
Apart from convenience and sufficient technical support for
e-commerce, consumers also deal with security problems. The increase of
cybercrimes and the lack of legal protection for consumers are seen as
crucial problems. The protection under the Consumer Law Protection of
1999
[11] and the Law on Information and Electronic Transaction of 2008
[12] might have answered some questions, but in practice, these still leave problems concerning law enforcement matters.
[1] Population by Age Group and Sex 2010, http://www.bps.go.id/aboutus.php?sp=1
[2] List of Countries by Population, http://en.wikipedia.org/wiki/List_of_countries_by_population
[3] Indonesia Internet Usage and Telecommunication Reports, http://www.internetworldstats.com/asia/id.htm
[4]
Indonesia the Most Reliant On Mobile Internet Access Across South East
Asia: Nielsen, http://id.nielsen.com/news/Release110711.shtml
[5] Current Status and Issues of E-Government in Indonesia, http://www.aseansec.org/13757.htm
[6] Indonesia Internet Usage and Telecommunication Reports, http://www.internetworldstats.com/asia/id.htm
[7]Facebook
in Asia: Total Users and Age Groups [Latest STAT],
http://www.greyreview.com/2010/03/02/facebook-in-asia-total-users-and-age-groups-latest-stats/
[8]
Indonesia Recognized as Worlds Biggest Twitter Addict,
http://asiancorrespondent.com/38839/research-proves-indonesia-is-worlds-biggest-twitter-addict/
[9] Daily
Social Research on How Indonesia’s Youngsters Use E-Commerce,
http://dsresearch.net/wp-content/uploads/2011/05/dsresearch-ecommerce-may11.pdf
[10] Peak
of Growth of E-Commerce in Indonesia Is Estimated in 2013,
http://econetwatch.com/e-commerce/peak-of-e-commerce-growth-in-indonesia-is-estimated-in-2013/
[11] Law No, 8 of 1999 on Consumer Protection.
[12] Law No. 11 of 2008 on Information and Electronic Transaction.
