Telco Industry in Indonesia Trend and Estimation

Telco Industry in Indonesia
Trend and Estimation for 2020
Hasnul Suhaimi
CEO – PT XL Axiata Tbk
January 2015
XL - PRIVATE
Telco in Indonesia is the most fierce and complex market Overview of Indonesia Market ü  Fastest growth in SEA with ~314 mn Mobile connec:ons ü More than 5 players are compe:ng in the market ü  Mobile telco services price is extremely low compare to other countries ü  Significant growth in Emerging Middle Class popula:on (higher spending) ü Data is the new source of growth for Telco XL - PRIVATE
It is a huge market and and mul=-­‐sim is very common 400
SIM Card in the market (mio)
375
367
200
382
393
SIM cards (mio)
350
Est subscribers (mio)
353
340
325
300
304
275
314
million subs
end of 2014
With the average of
327
Per subscribers
288
1.5 Simcard
250
225
240
MOBILE INTERNET DISPERSION (%)
200
66
175
150
125
245
100
75
50
180
190
209
218
226
255
262
52
236
150
25
2
0
’11
’12
’13
’14
’15
’18
’16
’17
’19 Smartphones
’20
Source: BCG analysis, indexmundi.com, worldpopulationreveiw.com, detik.com, Roy Morgan, TNS & internal analysis
3
”
45
XL - PRIVATE
Desktop
Notebook
Tablets
Traditional Voice & SMS activities decline in engagement as chat
increases
Current trend: data traffic growth 5 to 9 times revenue growth
Time Spent on Communication Activities - Q3 2014
Calls
SMS
Chat Apps
5mins/day
6mins/day
45mins/day
Copyright ©2012 The Nielsen Company. Confiden:al and proprietary. Mins/day on Calls
9
Mins/day on SMS
45
12
33
5
Q4 2013
Mins/day on Chat Apps
Q3 2014
Source: APAC ODM Panel - Q4’13 & Q3 2014
6
Q4 2013
Q3 2014
Q4 2013
Q3 2014
4
Mobile phone is the primary devices to go online in Indonesia with social media as the biggest traffic contributor Majority of internet users in Indonesia are mobile only …with social media and entertainment contribute ~ 50% from total traffic 24% SOCIAL MEDIA 20%
ENTERTAINMENT GENERAL INFO ~73 mio 75% 27% 2) Cisco
16%
E-­‐MAIL Total Indonesia Internet users Use mobile devices to use internet Mobile only Internet users VNI5August 2013 , internetworldstats.com, markplusinsight 2013, Business Monitor International Q2 2013
XL - PRIVATE
14% 12% GAMES
8% SHOPPING
LOCAL SEARCH 6% INDONESIANS SPEND CLOSE TO 2.5 HOURS ON
THEIR SMARTPHONES EVERYDAY
• 
Opportunity to increase engagement by introducing other apps or entertainment activities.
Overall SmartPhone Usage
Time spent per day (Minutes); Q3 2014
Mins/Day
301 206 186 174 146 86
Legend:
14
58
19
40
15
68
76
73
13
48
22
33
52
11
40
14
56
Thailand
Malaysia
India
Philippines
112
16
• 
ENTERTAINMENT
Source : Nielsen Informate Mobile Insights ODM Panel in 5 Markets
XL - PRIVATE
31
5
58
26
25
Indonesia
DEVICE
MANAGEMENT
COMMUNICATION
BROWSING
APPLICATIONS
Market are preparing the ecosystem inline with evolving Data
phenomenon
XL develop Digital business inline with Data trend… XL - PRIVATE
…while at the same :me, mobile E-­‐
commerce is on the rise 7
Mobile E-commerce is on the rise in Indonesia
• 
More smartphone users have been accessing shopping apps on their mobile devices.
E-Commerce Reach (%)
13
12
9
7
6
7
7
May_14
Jun_14
6
5
Jan_14
• 
Feb_14
Mar_14
Apr_14
Source: Indonesia ODM Panel – 2014 (Nielsen
Informate report for XL)
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Jul_14
Aug_14
Sep_14
4G/LTE will drive data consumption, mostly from video
• 
We observe 4G/LTE changing data consumption habits in other markets. Matter of time before Indonesia
adopts 4G.
Total Data Consumed Per Day (MB)
Data Usage Network – Wi-Fi/2G/3G/4G
Wi-Fi
2G
3G
4G
494
350
282
186
120 110
85
24 22
220
116
186
142
Small
base
NA
Indonesia
• 
172
Malaysia
Source: APAC ODM Panel - Q3 2014 – (Nielsen Informate
for XL)
XLreport
- PRIVATE
Philippines
Thailand
Data and beyond will change our way of live in the future
Before…
Now and Beyond…
Social Network
Gaming
Music & Video
Shop
Communication
10
XL - PRIVATE
Es=ma=on for 2020: small growth in subs, big griwth in data traffic Our challenge is in mone=za=on and capex/cost reduc=on. SIM Card in the market (mio)
400
382
SIM cards (mio)
375
367
Est subscribers (mio)
350
393
353
340
325
304
300
314
327
288
275
250
240
225
200
175
150
125
100
75
180
190
’12
’13
209
218
226
236
’14
’15
’16
’17
245
255
262
’18
’19
’20
150
50
25
0
’11
XLTNS
- PRIVATE
Source: BCG analysis, indexmundi.com, worldpopulationreveiw.com, detik.com, Roy Morgan,
& internal analysis
THANK YOU
XL - PRIVATE