Number of Internet users in RI expected to increase

Number of Internet users in RI expected to increase

JAKARTA (JP): The number of Internet users in Indonesia are
projected to increase from approximately 1 million in 1999 to
1.45 million in 2000 and 1.98 million in 2001, according to the
Association of Indonesian Internet Service Providers.

The association attributed the sharp growth in the number of
Internet users to the increase in the people's awareness about
the benefits of the service.

The number of local Internet domains surged by nearly 80
percent throughout 1999, hitting 4,685 sites in December from
only 2,624 sites in January, the association said in its report.

The association said corporate domains recorded the most
dynamic growth last year with sites rising by about 75 percent to
reach 3,544 sites in December from 2,042 in January.

And the U.S.-based telecoms and IT research firm,
International Data Corporation, estimated the number of Internet
users in Indonesia who will make purchases through e-commerce
will grow from approximately 70,000 in 2000 to 600,000 by 2003.

Indra M. Utoyo, general manager of multimedia division at
state telecoms company PT Telkom, said Internet and e-commerce
had become more and more attractive to business enterprises due
to their potential gain.

"The potential gain offered by Internet and e-commerce
businesses have also made them favorite choices for stock market
players, a condition which I consider a natural consequence," he
told The Jakarta Post over the week end.

At least eight new players are set to enter the virtual
business market during the first two months this year, including
listed companies like the insurance firm Asuransi Lippo Life
(Lippo E-net) and electronics and office equipment suppliers
Astra Graphia, Multipolar and Metrodata Electronics.

Multipolar plans to develop a high speed Internet access using
fiber optic with investment of Rp 130 billion (US$18.5 million);
Metrodata will create a portal site, Internet service and
business-to-business e-commerce worth no less than $2.5 million;
and Lippo Life will expand business to Internet and e-commerce
businesses.

Indra said it was a very good decision for companies
interested in the Internet and e-commerce sectors to immediately
establish their infrastructures and embark on the business.

"One of the keys to success in Internet business, besides the
prerequisite excellent infrastructures, is to be there earlier
than your competitors," he said.

"Internet, e-commerce is a very competitive business and a
zero sum game -- either you are in the business or out of it
completely," he added.

Indra said the more Internet and e-commerce services
established in the country, the more people would be aware and
interested to utilize services to ranging from booking a cinema
ticket to purchasing a cellular phone.

However, Indra warned it was possible that the predicted
increase in e-commerce users would not be achieved due to the
fact that Indonesia was still lacking in telephone lines and
computer access.

Data from state-owned telecommunications company PT Telkom at
the end of September last year showed there was only 5.94 million
fixed lines available for Indonesia's population of over 200
million.

Whereas only about 250,000 of approximately two million
computer users in Indonesia last year actually possess computers
in their homes.

Risa Merdekawati, executive director of the Indonesian
Telecommunications Society, said e-commerce, especially the
business-to-customer, was actually still at early phase of
development in Indonesia since the facilities were mainly used
for product display, information and orders, while payment for
the commerce was still person-to-person.

"No total e-commerce system is in place yet because banking
settlement to enable direct and secure credit card payment
through the Internet has not yet been established," Risa said.

She estimated that business to business e-commerce
would continue to dominate the service due to the lack individual
involvement.
It would be easier for companies to benefit from e-commerce in
business deals with other companies because business entities
generally have similar access to the prerequisite
infrastructures, she said.

Both Indra and Risa agreed that in order to maintain the
current healthy growth of Internet and e-commerce use, the
government and Internet industry must further promote not only
the awareness but also access to computers.

They said the number of Internet and e-commerce users would
increase to balance the supply of services only if there were
adequate and affordable access to telephone, computers and
Internet services. (cst)