Indonesia asks tech giants to partner with local telecom firms

Indonesia changes its policies concerning OTT companies, requiring them to partner with local companies. (Source: telegraph.co.uk)

Jakarta (VNA) – The Indonesian government has decided to change policies concerning Over-The-Top (OTT) internet content delivery companies including tech giants like Google, Yahoo, Facebook or Twitter operating in the Southeast Asian country.

Accordingly, OTT companies who want to get operation licences in Indonesia will have to partner with local telecommunications firms.

Rudiantara , Minister of Communication and Information Technology, said the requirement aims to improve problems in customer services, customer data protection and creates a fair playground.

The change is also to boost the Indonesian government’s income from tax.

Google, Yahoo, Facebook and Twitter are operating in Indonesia as dependent firms and all income will be transferred back to their holding companies.

Figures from the Indonesian Ministry of Communication and Information Technology show the total digital advertising value in Indonesia in 2015 was around 830 million USD with Facebook and Google making up 70 percent.

The new regulation is scheduled to take effect in the third quarter of this year along with regulations on tax, including income tax and value-added tax, for these tech giants.

Local telecommunications firms like Telkomsel, Indosat, Ooredoo and XL Axiata announced that they are ready to observe the government’s new regulations.-VNA