PARTNER FEATURE: Indonesia is being tipped to become a digital powerhouse in the coming years, given notable success stories already under its belt and a forecast to command the 10th largest GDP by 2030, up from 16th in 2021.

At the forefront of this rapid ascent looks set to be recently merged operator Indosat Ooredoo Hutchison (IOH), the nation’s second largest mobile operator. Here its CEO Vikram Sinha discusses his vision for the company and its role in driving digital evolution in the country, while simultaneously ensuring nobody is left behind by these technological changes.

Speaking in a media briefing at Digital Transformation World in Copenhagen, the executive highlighted the company’s impressive progress in combining assets of the two constituent operators and his aims for sustained revenue growth alongside societal impact.

In its current form the operator only came into existence at the start of 2022, but under its new guise IOH’s management have been quick to instill a sense of community and collaboration throughout the organisation.

This strength and scale is seen as a key advantage in Indonesia, a country the executive believes holds huge potential.

Indonesia has the fourth largest population in the world with around 273 million people and, Sinha notes, a budding technology sector with 12 of the 24 Unicorn companies in the region being founded in the country.

There are already strong digital uptake indicators in the country. Statistics estimate a 74 per cent internet penetration rate, 40 per cent banked population and 19 per cent penetration of digital wallets.

Having been in a senior position of an operator in the country since 2019 the executive, who has worked across several markets including India and Nigeria, is confident Indonesia and IOH can reach their potentials.

Vikram Sinha, President Director and CEO of Indosat Ooredoo Hutchison (IOH)
Vikram Sinha, President Director and CEO of Indosat Ooredoo Hutchison (IOH)

“I’ve been here for three and a half years now and after travelling, especially small villages, all the potential, especially with digital natives is incredible,” Sinha (pictured, right) said, adding he had no doubt “Indonesia will be the digital power of South East Asia”.

He indicated with the current supportive approach from the Government it has the potential to become one of the most significant digital powerhouses in the world.

Work to do
In terms of infrastructure, Sinha acknowledged an increase in average data consumption and usage but also cautioned there were almost 12,000 villages without access to 4G.

The connecting of these areas is a priority for both IOH and authorities in the country, with operators now able to share infrastructure which enables them to connect remote areas across its numerous islands.

Along with infrastructure sharing the operator is exploring satellite communications technology and how it can play a part in connecting areas with limited coverage.

“The real challenge is transport,” he added. “It is not about putting in sites, it’s how you connect and how you make sure that you are able to carry the traffic out.” He noted the company was keeping updated with recent “breakthroughs, especially [satellite] companies like One Web or StarLink”.

Alongside assessing technical solutions of connecting underserved areas, the operator has also undertaken a number of initiatives to provide digital skills.

This covers both education to pave the way for employment opportunities and schemes targeted specifically at unconnected people to help them get online in a user-friendly way, undertaken at a village-by-village level.

This drive to digital has been especially helped by measures brought about in response to the coronavirus pandemic, where things like adding account credit without visiting a physical shop became a necessity.

While increasing 4G and providing the tools for a greater number of people to use it are clear priorities, IOH is also pushing forward the delivery of the next generation of mobile connectivity technology.

It has already launched 5G in six cities including, in partnership with Huawei, providing network support ahead of the G20 meeting in Bali scheduled for November 2022.

Customer relationships
As with much M&A activity a significant proportion of the media and other third party attention on the merger to create Indosat Ooredoo Hutchison was focused on operational savings.

Although noting its successes in creating early efficiencies combining its systems, Sinha noted you “cannot drive an organisation saying about driving synergies” adding although it had to achieve them the key to making the company a success was in bringing the right product to market.

“We want to be a purpose-driven organisation and our purpose is not only to connect to empower community and society, but really help us galvanise the organisation,” he added.

Part of this mission is to build customer trust including things like avoiding “toxic revenue” such as the bill-shock associated with unexpected roaming costs and untransparent pricing which comes to policies such as auto-renewal of products.

The IOH ethos is adding “value in a sustainable manner” for the products and services it supplies, while its financial aims are to create a company delivering sustainable revenue growth and profitability.

Providing the high levels of customer services, coverage and product needed to succeed in today’s market has seen the company collaborating with a wide range of partners. Alongside increasing coverage, these partnerships can aid in the delivery of wider valued digital services.

Looking forward the executive cited major opportunities in serving Indonesia’s many SMEs, of which there are 62 million. Included in this drive is the creation of a marketplace for small retailers and producers which IOH is collaborating with Google on. This B2X platform launched last month and is in the process of scaling-up.

Other potential opportunities include IoT security as a service, virtual private networks for enterprises and manufacturing to aid automation.  “The underlying theme is we are not trying to do everything ourselves. We are trying to get the right partner on board with the and then we create the upside.”

These partnerships in areas such as utilising cloud are expected to create new revenue streams for the operator, addressing an area he notes operators traditionally lost out in, leading players to be deemed a “dumb pipe”.

Its nature of collaboration, he added, is aligned to a popular philosophy of collaboration and community which runs through Indonesian society.

This sense of community and ambition to help Indonesia reach its significant potential is admirable and, should the country meet its significant digital potential, many other operators are likely to be looking to follow IOH’s blueprint of digital operator growth.

To learn more about Indosat Ooredoo Hutchison, please click here.