How to Start Internet Providers Business in Indonesia

Business Opportunity in the Internet Service Providers in Indonesia

  • InCorp Editorial Team
  • 17 October 2024
  • 6 minutes reading time

The internet providers sector in Indonesia is rapidly evolving, presenting exciting business opportunities for investors eager to capitalize on this growing market. However, navigating this landscape is not without its challenges. 

While the demand for reliable, high-speed internet services continues to rise, newcomers face significant hurdles, such as complex regulatory environments and infrastructure limitations that hinder service delivery. Additionally, the market’s increasing competition makes it essential for new entrants to differentiate themselves and provide consistent quality and customer support.

Despite these challenges, investors have a unique chance to enter the industry and contribute to enhancing connectivity for millions of users across the archipelago. By addressing these pain points, investors can play a crucial role in shaping a more connected Indonesia.

What is An Internet Service Provider?

An Internet Service Provider (ISP) is a company that offers internet access to businesses and individuals. Many ISPs provide access methods such as cable, DSL, fiber optics, dial-up, and wireless.

ISPs enable users to browse the web, shop online, conduct business, and stay connected with others, usually for a fee. Moreover, they may offer services like email, domain registration, web hosting, and browser packages.

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Internet Service Provider vs. WiFi Provider

When choosing how to access the internet, it’s important to understand the differences between an Internet Service Provider (ISP) and a WiFi provider. Here is a comparison table highlighting these differences.

FeatureInternet Service Provider (ISP)WiFi Provider
DefinitionProvides internet access through various means, such as cable, DSL, fiber, or satellite connections.Enables wireless internet access using a modem and wireless router.
Connection TypesCable, DSL, fiber optics, satelliteWireless (WiFi)
FunctionalitySupplies the actual internet connection.Distributes internet access wirelessly.
Equipment RequiredDepending on the service, it may require a modem and/or router.Requires a modem connected to a wireless router.
Signal TypeDirect wired connections to homes/businesses.Wireless signal transmitted for mobile devices.
Coverage AreaIt varies based on service type and provider; it typically has broader coverage.Limited to the range of the wireless router.
User DevicesCan connect multiple devices through a wired connection.Allows multiple devices to connect wirelessly.
InstallationInstallation may require a professional setup.The user can often set it up.

Examples of Internet Service Providers

Many business internet providers service cater to different markets worldwide. These providers offer unique services tailored to meet diverse customer needs. Some of the examples are:

Verizon

Verizon is a major telecommunications provider that offers telephone, internet, and television services to residential and business consumers.

Telstra

Telstra is Australia’s largest telecom company, offering mobile and internet services, entertainment packages, cybersecurity solutions, and business support.

ACT Fibernet

ACT (Atria Convergence Technologies Ltd.) is a leading Indian broadband and cable provider, offering services like Fibernet and digital TV to nearly 2 million homes.

Openserve

Openserve is South Africa’s largest wholesale broadband provider, offering high-bandwidth data, voice, and managed services. It connects homes, businesses, and developments nationwide, partnering with ISPs to deliver extensive coverage.

Excitel Broadband

Excitel is a broadband provider offering high-speed fiber optic internet services across various Indian cities. It focuses on delivering fast broadband options to enhance entertainment experiences for young consumers at home.

Examples of Internet Service Providers in Indonesia

According to the Indonesian Internet Service Providers Association (APJII), over 1,000 ISP companies are currently in Indonesia. However, only a few ISPs are widely used by the public. Here are some examples of ISPs in Indonesia:

IndiHome

This ISP brand is well-known among Indonesians. IndiHome, a product of Telkom Indonesia, uses fiber optic technology to provide high-speed internet access, reaching up to 300 Mbps.

First Media

As Indonesia’s first high-speed internet provider, First Media offers internet access speeds of up to 1 Gbps and various streaming media (OTT) packages.

MyRepublic

MyRepublic is another well-regarded ISP in Indonesia. Since 2015, this ISP has offered fast and flexible internet packages for households and small businesses.

Biznet Home

Biznet Home is another example of an ISP in Indonesia. The Biznet Networks website notes that it provides internet access, data center services, IPTV, and cloud computing.

CBN Fiber

With internet speeds of up to 1 Gbps, CBN Fiber is considered one of Indonesia’s top and fastest ISPs. In addition to fast speeds, this ISP uses fiber-to-the-home (FTTH) technology, ensuring a stable and smooth internet connection.

The Opportunity of Internet Service Provider Business in Indonesia

The number of internet companies under the Indonesian Internet Service Providers Association (APJII) has nearly tripled over the past three years, increasing from 400 ISPs to 1,100–1,200.

According to senior APJII member Victor Irianto, the banking sector, which previously showed little interest in supporting internet providers, has begun to notice the industry, including foreign players. Foreign investments are flowing into Indonesia’s internet sector, recognizing the vast growth potential.

Starlink, the low-orbit satellite internet provider services Elon Musk owns, has recently launched in Indonesia, expanding its operations to 77 countries. Indonesia’s Internet Service Providers (ISPs) have been addressing connectivity challenges through various technologies, ranging from fiber optics to wireless networks.

However, the entry of Starlink, a satellite internet service from SpaceX, could significantly transform the competitive landscape. Unlike traditional cable-based technologies such as fiber optics for transmitting data, satellite systems use radio signals through the vacuum of space.

How to Build Your Internet Service Provider Business in Indonesia

How to Start Internet Providers Business in Indonesia

Several factors must be considered when starting an internet provider service business in Indonesia. Understanding the regulatory requirements and market dynamics is essential for building a successful operation.

Business Identification Number (NIB)

Entrepreneurs must obtain a Business Identification Number (NIB) to operate an ISP business. The NIB is an official government identification issued to business entities. Business owners can obtain the NIB through the OSS system.

Standards Certification

For high-risk business activities that require adherence to business and/or product standards, the Central or Regional Government may issue:

  • Business standards certificates and
  • Product standards certificates.

The issuance of these certificates is based on verifying compliance with the standards. This is crucial, as certification determines whether a business meets the required benchmarks.

Licenses

A license is an authorization from the Central or Regional Government that must be obtained before starting business activities. The required license for ISP business in Indonesia is the Izin Penyelenggaraan Jasa Akses Internet, issued by the Ministry of Communication and Information Technology (Kominfo).

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Unlock Business Potential in Indonesia’s Internet Provider Services with InCorp

Indonesia’s rapidly expanding internet service provider business offers immense opportunities for investors looking to enter this high-growth sector. The country is experiencing a surge in demand for reliable internet services, with significant potential across various segments.

Investors looking to seize these internet providers business can rely on InCorp Indonesia, which offers comprehensive solutions, including:

Fill out the form below to scale your business, expand your market presence, and enjoy a seamless setup experience.

Daris Salam

COO Indonesia at InCorp Indonesia

With more than 10 years of expertise in accounting and finance, Daris Salam dedicates his knowledge to consistently improving the performance of InCorp Indonesia and maintaining clients and partnerships.

Get in touch with us.

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Frequent Asked Questions

There are three things business owners need to consider before setting up a business in Indonesia: the type of business entity, capital requirements, and regulations.

Indonesian regulations separate local companies from foreign companies. Generally, foreign-owned companies (PT PMA) have more limitations than their local counterparts (Local PT). However, to pursue more foreign direct investment in the country, the government has taken several bold initiatives to increase the ease of doing business and provide numerous attractive incentives for foreign investors.

There are two main types, namely, primary business licenses and non-primary business licenses. The primary ones commonly apply to various industries, such as general and industrial business licenses. Additional non-primary ones are included, depending on the operations of your business. Examples of non-primary business licenses are operational and commercial licenses.

Yes, you must apply for it to be able to issue work permits for your foreign employees. This permanent business license is also a prerequisite for the applications for other business licenses and import licenses.