- 21/02/2025
- Category: Commentaries
Author: Hosea Immanuel Latumahina
Editor: Achmed Faiz Yudha Siregar
Internet access is now a basic necessity for society and an important component in economic development, education, and digital transformation. However, in Indonesia, there are still various challenges in realizing fast and affordable connectivity for all levels of society. One of the major issues that has emerged is the gap between internet speed and tariffs that have not been able to be adjusted to the needs of users. Based on the We Are Social and Hootsuite Report 2024, there are above 200 million people using the internet in Indonesia, either for work, for education, for entertainment, or even for business purposes[1]. However, there are many users that are struggling to use the internet because of its tariff, especially those who live in rural areas[2]. In this context, a comparison with other ASEAN countries can provide a clearer picture of the problems faced by Indonesia.
The Weakest Internet Among the ASEAN Countries
Based on data from the Speedtest Global Index 2024, Indonesia is still lagging behind in terms of internet speed compared to many other ASEAN countries. The average download speed in Indonesia is only around 20 Mbps, which is much lower than neighboring countries such as Singapore which has speeds of more than 200 Mbps, or Thailand which averages 50 Mbps. These limited speeds affect access to increasingly important digital services in education, work and entertainment. While Indonesia has large cities with better internet infrastructure, areas outside Java, especially in eastern Indonesia, still experience difficulties in accessing fast and stable internet connections[3].
Almost The Most Expensive Internet Among the ASEAN countries
Apart from speed, internet tariffs in Indonesia are also an important issue. According to a report from The Economist Intelligence Unit (2023), internet tariffs in Indonesia are relatively high compared to other ASEAN countries[4]. For example, an internet speed of 50 Mbps in Indonesia can cost around US$30,82 to US$43,15 per month, while in countries like Thailand, the price for an equivalent service is only around US$18,54 but offers median speed up-to 189,64 Mbps, which cost US$0,10 per Mbps. Vietnam follows as the country with the most cheap internet costs in ASEAN. With a monthly fee of US$10.83 and a median speed of 71.86 Mbps, the internet cost per Mbps in Vietnam is US$0.15. Malaysia, which has a relatively similar monthly internet fee to Indonesia at US$27.26, has a higher access speed of 84.78 Mbps with a monthly fee around US$0,33 per Mbps. This data shows that the internet’s tariff in Indonesia is much more expensive compared to other countries in regional ASEAN[5]. Singapore, despite its higher rates, also offers much faster and more stable speeds.
High internet tariffs in Indonesia exacerbate the digital divide, particularly between urban and rural areas, limiting access to essential services and opportunities[6]. This digital inequality hinders equal participation in the digital economy and impacts education and public service access[7]. Small and medium enterprises (SMEs), which rely on the internet for operations, suffer from higher operational costs, leading to reduced productivity and growth potential[8]. Additionally, expensive internet access stifles the adoption of emerging technologies, limiting innovation and competitiveness[9]. Without affordable internet infrastructure, Indonesia faces significant barriers to technological advancement and economic development. To overcome this, policy interventions to reduce internet costs and improve digital infrastructure are essential[10].
What Makes Indonesia’s Internet So Expensive and Weak?
Despite the realization of the importance of Internet connectivity in supporting various sectors, the accelerated development of Internet infrastructure in Indonesia still encounters various obstacles. One of the biggest challenges is the unequal distribution of infrastructure, with remote areas outside Java often left behind.
The financing required to build fiber optic networks and 4G or 5G infrastructure in these areas is substantial and time-consuming. According to the Ministry of Communication and Informatics (2024), internet infrastructure development in underdeveloped areas is still a top priority despite facing complex geographical challenges[11].
In addition, regulatory and bureaucracy constraints also play an important role in slowing down this process. Complicated licensing processes and the absence of sufficient incentives for service providers to enter certain areas make network development more difficult. This affects the speed of internet expansion in different regions, which ultimately results in inequality in the quality and price of internet services across Indonesia.
How Does the Government Respond to the Problem?
The Indonesian government recognizes the importance of the information and communication technology (ICT) sector in supporting the advancement of the digital economy. Therefore, the ICT sector receives a sizable budget allocation in the APBN. In the APBN 2024, the budget allocation for the ICT sector reaches more than IDR 7 trillion, which is used for the development of digital infrastructure, increasing the capacity of human resources in the ICT field, as well as programs to accelerate digital transformation[12]. The total investment of the APBN for digital infrastructure from 2019 to 2022 has reached IDR 75 trillion. However, despite the increase in budget every year, the biggest challenge is to ensure that this budget can be used efficiently and equitably, especially for areas that still experience limited internet access.
As an important aspect of the ICT sector, the Indonesian government is also focusing on improving internet speeds nationwide. For this reason, the APBN allocated to accelerate internet connections is also not small. In 2024, the government allocated around IDR 2 trillion to accelerate the deployment of 4G networks in underdeveloped areas, as well as to develop 5G networks in major cities. The government has also initiated and implemented national strategic programs that focus on accelerating internet connectivity such as the Palapa Ring program which aims to build fiber optic networks throughout Indonesia, the Telecommunication Incentive Assistance program through the construction of telecommunication towers in remote areas which includes the installation of Base Transceiver Stations (BTS) for remote areas, and the Internet Desa program aims to provide internet access in remote villages through the construction of Wi-Fi infrastructure and satellite-based internet networks.
Although those are positive programs, the biggest challenge remains the distribution of the budget and ensuring that these infrastructure projects can actually reach the areas most in need. Providing High internet speeds that are evenly distributed across Indonesia is still a big chore.
An Ambitious Target Amidst the Problematics Reality?
Despite the serious problems associated with internet speed, the government has a very ambitious plan to encourage digital transformation in Indonesia, by designing a national digitalization acceleration agenda covered in the 2020-2024 National Medium-Term Development Plan (RPJMN)[13]. One of the main goals is to expand the fast internet network to all corners of the country. The Palapa Ring program, as we mentioned before, is one of the main steps aimed at building a national fiber optic network, which covers almost all parts of Indonesia, including remote areas. The government also aims to reach 100% 4G internet connectivity across Indonesia by 2025[14].
Another agenda in this plan is to expand digital infrastructure to all corners of the country, as well as encourage digitalization in various sectors such as education, health, and the economy. Programs such as 100 Smart Cities and 1,000 Digital Startups are part of the effort to accelerate equitable digital access across Indonesia[15]. In addition, the government also aims to increase 4G and 5G internet penetration across Indonesia by 2025. With a bigger budget and a clear agenda, the acceleration of digitalization is expected to bring great benefits to the people of Indonesia, although the challenges on the ground still require cooperation between the government, the private sector, and the community.
[1] We Are Social, 2024. Digital 2024: Indonesia. [online] Available at: https://wearesocial.com/id/blog/2024/01/digital-2024/
[2] World Bank, 2019. Overview of Indonesia’s Digital Economy and the Challenges Ahead. [online] Available at: https://documents1.worldbank.org/curated/en/611531627051206860/pdf/Overview.pdf
[3] Speedtest by Ookla, 2024. Speedtest Global Index. [online] Available at: https://www.speedtest.net/global-index
[4] The Economist Intelligence Unit (EIU), 2024. Telecommunications in Indonesia. [online] Available at: https://www.eiu.com/industry/telecommunications/asia/indonesia
[5] GoodStats, 2024. Kecepatan Internet Indonesia Terendah ke-2 di Asia Tenggara. [online] Available at: https://goodstats.id/article/kecepatan-internet-indonesia-terendah-ke-2-di-asia-tenggara-e7CMa
[6] Badan Pusat Statistik (BPS), 2020. Statistik Telekomunikasi Indonesia 2020. [online] Available at: https://www.bps.go.id/en/publication/2021/10/11/e03aca1e6ae93396ee660328/telecommunication-statistics-in-indonesia-2020.html
[7] Puspitasari, V., 2021. Pendirian Pojok Digital dalam Upaya Mengatasi Tantangan Kesenjangan Digital di Desa Jatihurip.
[8] Kurniawan, R., 2022. Kesenjangan Digital Sebagai Tantangan Dalam Era Transformasi Teknologi. Kompasiana, [online] Available at: https://www.kompasiana.com/robyadhitya1497/678a3aed34777c49477cbe93/kesenjangan-digital-sebagai-tantangan-dalam-era-transformasi-teknologi?page=2
[9] Siregar, I., 2021. Kesenjangan Digital dan Solusi yang Diterapkan di Indonesia Selama Pandemi COVID-19. Jurnal IPTEKKOM. [online] Available at: https://jurnal.kominfo.go.id/index.php/iptekkom/article/view/4859/1896
[10] Indrawati, S., 2022. Mengatasi Kesenjangan Digital dalam Pendidikan: Sosial dan Bets. Jurnal Nakula. [online] Available at: https://journal.aripi.or.id/index.php/Nakula/article/view/954
[11] Kementerian Komunikasi dan Informatika (Kominfo), 2024. Pembangunan Infrastruktur Digital di Daerah 3T. [online] Tersedia di: https://www.kominfo.go.id/berita/pengumuman/detail/tingkatkan-konektivitas-daerah-3t-kominfo-kaji-optimalkan-5g
[12] Kementerian Keuangan Republik Indonesia, 2024. Pemerataan Akses Internet dengan Infrastruktur TIK. [online] Tersedia di: https://anggaran.kemenkeu.go.id/in/post/pemerataan-akses-internet-dengan-infrastruktur-tik
[13] Kementerian Komunikasi dan Informatika Republik Indonesia, 2020. Rencana Pembangunan Jangka Menengah Nasional (RPJMN) 2020-2024. [online] Tersedia di: https://www.bappenas.go.id/files/6415/9731/9571/RPJMN_2020-2024_Volume_I.pdf
[14] ASEAN Briefing, 2019. Indonesia’s Palapa Ring: Bringing Connectivity to the Archipelago. [online] Tersedia di: https://www.aseanbriefing.com/news/indonesias-palapa-ring-bringing-connectivity-archipelago/
[15] Kementerian Komunikasi dan Informatika Republik Indonesia, 2024. Inisiatif Pemerintah dalam Akses Internet dan Penyebaran 4G di Daerah Terpencil Indonesia. [online] Tersedia di: https://intimedia.id/read/government-initiatives-in-internet-access-and-4g-deployment-in-remote-areas-of-indonesia-in-2024
