The growing adoption of 4G/5G services and steady growth in fibre broadband subscriptions will drive the total telecom and pay-TV services revenue in Indonesia at a compound annual growth rate (CAGR) of 4.5 per cent from $15.1 billion (€13.9bn) in 2023 to $18.8 billion in 2028, forecasts GlobalData, the data and analytics company.

GlobalData’s Indonesia Telecom Operators Country Intelligence Report states that the mobile voice service revenue will decline over the forecast period, due to the bundling of free voice minutes with mobile service plans, increasing use of OTT-based communication apps for voice calling, and the subsequent decline in mobile voice average revenue per user (ARPU) levels.

Mobile data service revenue, on the other hand, will continue to increase driven by the continued rise in mobile internet subscriptions, aggregate growth in 4G subscriptions, and more importantly growing adoption of higher ARPU-yielding 5G services over the forecast period.

Sarwat Zeeshan, Telecom Analyst at GlobalData, commented: “4G will remain the leading mobile technology in Indonesia over the forecast period, by subscription share, benefiting from the Ministry of Communications and Informatics’ (MCI) push for 3G shutdown and MNOs continued 4G/LTE network expansion. For instance, as of July 2024, Telkomsel expanded its 4G network coverage to 97 per cent of the country’s population after decommissioning its 3G network and upgrading it to 4G/LTE technology in June 2023. With the ongoing 5G network upgrades and plans for more widespread 5G network rollouts by the operators, 5G services will go on to account for more than 20.8 per cent of total mobile subscriptions in the country by 2028.”

In the fixed communication services segment, fixed voice revenue will continue to decline as customers switch to mobile and internet-based voice communication services. Fixed broadband services revenue, on the other hand, will grow at a CAGR of 6.9 per cent over the 2023-2028 period, supported by the continued subscription gains in fibre broadband services, on the back of ongoing fibre network coverage expansion.

Zeeshan added: “The growing demand for high-speed broadband connectivity and ongoing fibre-optic infrastructure expansions in the country will support the growth in fiber broadband subscriptions over the forecast period. For instance, Fiberstar, an Indonesian telecom infrastructure company, extended its fibre-optic networks to achieve 1.9 million homepasses spread across 135 cities and 17 provinces, as of December 2023, and aims to bring this total to 2.8 million homepasses by the end of 2024.

Pay-TV service segment will see a decline in revenue over the forecast period, due to the continued drop in cable TV subscriptions and decline in total pay-TV service ARPU.

Zeeshan concluded: “Telkomsel topped mobile and fixed communication market segments, by subscriptions in 2023. Its ongoing 4G network expansion and 5G network rollout will help to maintain its leadership in the mobile services segment. The telco has launched 5G services in over 49 cities in 2023. The operator is stepping up investment to expand 5G network in the country. Its leadership in the fixed broadband segment is primarily due to its strong presence in the fibre broadband segment. The telco has invested heavily in fibre-optic network and last mile connectivity, to provide high-speed broadband services.”

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Categories: Articles, Markets, Pay TV, Research, Telco

Tags: 5G, fibre, globaldata, Indonesia, pay TV