Wed, 09 Feb 2011
From: The Jakarta Globe
By Shirley Christie
Younger and less affluent users have pushed mobile phone penetration in Indonesia to almost triple what it was five years ago, according to a Nielsen survey.

Out of 15,000 respondents from nine large cities, 54 percent said they owned a mobile phone, a 34 percent increase from a similar survey in 2005. In contrast, only 11 percent of respondents said they owned a landline phone, down from 25 percent in 2005.

Viraj Juthani, director of the telecom practice group at Nielsen, said landline phones never took off before being overtaken by mobile phones.

“Telecommunications generally develops from not being connected at all to having landline connections, then to cellular phones,” he said. In Indonesia, he added, unconnected consumers went directly to mobile phones.

Respondents came from Jakarta and the surrounding area, Bandung, Surabaya, Semarang, Yogyakarta, Medan, Palembang, Makassar and Denpasar. The survey took place from September 2009 to October 2010.

Younger consumers have driven the growth in recent years, the survey showed.

“While penetration among 20- to 39-year-olds has been high since five years ago, it is the younger age group that pushed the growth in the cellular phone market in Indonesia. Growth among teens has tripled as penetration reached more than 70 percent of this segment,” the report said.

The survey also showed that 58 percent of mobile customers spent Rp 50,000 ($6) or less per month last year, while 29 percent spent between Rp 50,000 and Rp 100,000. Six percent spent between Rp 100,000 and Rp 150,000, and the rest spent more than Rp 150,000.

“The revenue that operators make is going down,” Juthani said, pointing to increased competition among 11 telecommunications operators in Indonesia.

Iwan Rachmat, senior consultant for information and communication technologies at Frost & Sullivan Indonesia, told the Jakarta Globe that Indonesia’s blended average revenue per mobile user of $3.33 in 2010 was expected to fall to $2.99 by 2015.

With SIM card penetration at 97 percent, he said, “operators will look for other sources of growth if they want to keep or expand their revenue market share.”



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