The vast smartphone consumption in Indonesia becomes an interesting challenge to players of the industry. In fact, Taiwan-based OEM and ODM developer Arima Communication Corp. has planned to support Asus and HTC Corporation’s production in Indonesia. It previously partnered with numerous local partners, including PT Ti-Phone Mobile during its support for LG and Sony.
Asus has partnered with Batam-based PT Sat Nusapersada Tbk upon manufacturing its Zenfone, which also establishes a factory in Surabaya. Meanwhile, HTC has yet had any local production done in the country, thus it partners with Arima to start one.
This partnership could be something, since Ti-Phone booked Rp 182.731 billion of profit during the first semester of 2015, thanks to Arima’s support in its headset development.
Other Taiwan-based developers also plan on entering Indonesia, one of them is Foxconn Technology Group. The value of investment spent by this smartphone, tablet, and TV manufacturer is rumoured to reach $1 billion, although its realization is still blocked by the regulation that the local government applies.
As the Ministry of Communication and Information suggested, the volume of imported smartphone that enters Indonesia is gradually decreasing, with the latest figure was as low as $2 billion per year. It’s predicted that the number will slightly go up to $3 billion through legal channel, while the illegal one will contribute no less than $2 billion, by this year. In addition, there are more than 800 types of smartphone flooding Indonesian market.
The current government has just broaden the tax holiday incentive to nine pioneering industries in Indonesia, including telecommunication. Ministry of Finance Bambang Brodjonegoro stated that the government had reduced the need of investment for telecommunication sector, from Rp 1 trillion to Rp 500 billion, to meet the requirement for getting the tax holiday facility.
The regulation of local components for 4G smartphones indeed becomes the basis of product development in Indonesia. The objective of this regulation is to let Indonesians learn and get involved in the process of producing world-class local products.
