Locally brands dominate domestic market

I. Christianto, Contributor, Jakarta

Many parties prefer to purchase locally assembled personal computers (PC), which are popularly known as jangkrik (cricket).

People have their own reasons for buying locally assembled PCs, normally for their down-to-earth prices compared to top, famous brands.

Behind the fact of fast-selling locally produced PCs, there are anecdotes about these PCs are called crickets. The term jangkrik, in certain parts of Indonesia, is a familiar term shouted when people get upset, for example if their PC hangs.

This is understandable, as the low quality often causes such PCs to hang during operation.

Some people say such low-cost PCs also make noises like crickets. The term also is used locally for unbranded electronic items.

Other people, however, believe crickets can make big leaps, meaning that such PCs can be easily upgraded for much better performance.

Despite the anecdotes, locally made computers are in demand in the domestic market.

Junaidi Aris Lee, a market analyst for the International Data Corporation (IDC) Asia Pacific in Jakarta, said that locally assembled PCs dominated the local market, with about 60 percent market share in 2001.

"The figures have remained stable in recent years as the quality becomes more competitive. In the fourth quarter of 2001, there were 132,000 (PCs) sold and 66 percent of them were locally assembled," he said.

Interestingly, according to Junaidi, some 70 percent of the buyers were companies or institutions. This means locally assembled PCs are not just popular with individuals, but also with businesses.

He said total PC sales this year were expected to reach some 566,000 units, a significant increase from 482,000 units in 2001. In 2000, the figure was 416,000 units, he added.

"The market for the PC has recovered after plummeting in the years following the country's financial turmoil. The banking, telecommunications as well as the oil an gas sectors have showed signs of recovery, which has had a positive impact on the PC market," he said.

The Indonesian Computer Dealers Association (Apkomindo) estimates PC sales totaled 279,000 units in volume or about US$334.8 million in value in 1999, after plunging to 74,000 units (worth $88.8 million) in 1998. This was a big improvement but still far from the precrisis level of 392,000 units ($470.4 million) in 1997.

Computer sales are significantly affected by the fluctuation of the local currency against the dollar. When the rupiah weakens, PC prices instantly increase. To save themselves from the threat of financial loss, local vendors usually set PC prices in American dollars. Fluctuations in the rupiah is a computer dealer's worst nightmare, as more than 80 percent of the computer components in a PC are imported.

Meilanie Huda, the marketing manager of PT Berca Cakra Teknologi, a local company which produces the Relion computer, agreed that the quality of locally made PCs had become more competitive with top overseas brands.

"When we talk about PCs, we will find about the same quality as an electronic device. The local names are also equipped with the same components such as the Pentium 3 or Pentium 4 processor, Intel motherboard. The difference is the sales support and after- sales service," she said.

She said with good sales support and service, locally assembled PCs would be able to grab a greater market.

"The market is increasing. Even with more producers, the competition will remain slow," she said.

Berca began producing and marketing Relion in October last year. There are four series of the Relion -- Credo, Ventura, Pride and Premio -- which aim at different segments of the market, from the beginner, small businesses, professionals and lifestyle purchasers.

"Prices start at between $500 and $1,044 per unit, depending on the type and additional features," said Meilanie

Besides Berca, local companies offering PCs include Zyrex, Mugen, Garuda and Wearnes. They are now able to compete with top international brands such as IBM, Acer and Compaq.

Yulia Andriani, a member of the marketing staff at PT Oriental Komputer Bahtera, which has manufactured Garuda PC since 1983, said that both local and domestic computer makers aimed at corporate buyers.

"PC makers still regard corporate businesses as more lucrative than individual buyers. When the economy weakens, as happened in the last few years, PC makers will still target corporate business on a rental system," she said.

Eventually, there are "real" locally assembled PCs sought by individuals for their reasonable prices and good performance. These are custom-made to order by PC shops.

Just go to Mangga Dua Mal or Gajah Mada Plaza, two shopping centers in the capital's Chinatown. Many PC stores offer low cost products, as they are really "homemade". There are also vendors at other places, including Mall Ambassador and Ratu Plaza in South Jakarta.

The rapid development in information technology has created numerous innovative devices that have helped lower prices further. Processors, memory chips, synchronous DRAM and other equipment are now offered at much lower prices, causing PC prices to drop.

Locally made PCs offered by vendors may contain various components from different makers, which may not operate in complete harmony. For instance, a good processor should be matched with a proper Random Access Memory (RAM). When they do not match, there will most likely be a blockage in the flow of the data in the PCs.

In addition to a processor and RAM, there are other important components including the motherboard, Video Graphic Adapter (VGA), hard disc, floppy disc and sound card which should ideally match each other. When completed, the device, which is called a Central Processing Unit (CPU), must be equipped with a monitor, keyboard, mouse and other accessories to become a PC. These items should also match each other. Based on the possibility of assembling a PC with various components, prospective users can ask for a particular PC with certain specifications for the lowest price. If this happens, it is likely locally assembled PCs will grab an even greater share of the market in Indonesia.

Here are some important tips in buying locally assembled PCs:

1. Before buying one, you must first assess what will you do with the PC. A PC has many accessories or features such as a microphone or webcam that you don't have to install, which will lower the price.

2. If you really want some features, select the most useful, including CD-RW drive, CD-ROM drive, DVD-ROM drive, removable media-drive, graphic card AGP, voice card, network card, modem and so on. 3. Check and test the body case, power supply, keyboard, mouse, operation system, cooler fan and monitor. Also find out how the floppy disc drive and hard drive work. 4. Check the motherboard. It should ideally match with the processor. 5. Check the memory to make sure it matches with the RAM type and motherboard speed. 6. Can the PC be upgraded? Old components may not be match with new components. 7. Check the software, is it original or illegal? The U.S.-based Business Software Alliance (BSA) estimates more than 80 percent of PC software sold in Indonesia is pirated. 8. Buy PC at shops owned by people you know well. This is to avoid the possibility of being sold a PC with used components. 9. Ask for a warranty and know the type of after-sales services you are entitled to.