The Ministry of Communication and Informatics has planned to impose regional restrictions on the operation of SpaceX’s Starlink satellite internet service in Indonesia.
Starlink’s service for retail customers was officially launched by SpaceX CEO Elon Musk on Sunday, May 19, 2024. Previously, the satellite service had been catering to corporate clients as a backhaul for Telkomsat, a subsidiary of Telkom.
However, the introduction of Starlink to the retail market has sparked mixed reactions within the local telecommunications industry. In response, the Ministry of Communication and Informatics has initiated discussions to direct the operation of Starlink.
“This matter is currently under discussion. The idea is to initially direct it to support telecommunications networks or reach 3T (underdeveloped, frontier, and outermost) areas,” Deputy Minister of Communication and Informatics, Nezar Patria, said on May 31, 2024.
He said that Starlink, being a Low Earth Orbit (LEO) satellite, has the advantage of covering all areas, including regions that are difficult to access with land-based infrastructure.
“The government still has work to do considering that many remote areas in Indonesia remain unconnected to the internet. We see it starting to operate and are continuously monitoring its effectiveness and how it can aid connectivity in 3T areas,” he revealed.
Nevertheless, Nezar clarified that the government does not prohibit Starlink from being used in urban areas. The aim is to ensure fair competition within the telecommunications industry.
“We aim to guarantee a level playing field for everyone. Starlink can reach anywhere because it’s a satellite, but we ensure no one gets special treatment,” he said.
Concerns from experts and companies
Some experts are concerned about Starlink engaging in predatory pricing, citing its 40 percent discount on devices in Indonesia. The ministry is considering regulating internet prices to address these concerns.
“The pricing mechanism is market-driven. The faster the internet service, the higher the price,” Nezar said.
Stakeholders in the telecommunications industry can discuss internet pricing and its impact on business. Meanwhile, the Ministry of Communication and Informatics focuses on maintaining healthy business competition through equal regulations for all players.
“There is absolutely no predatory pricing. Starlink’s promotions are legally permissible,” said Starlink’s legal team member, Krishna Vesa, during a Focus Group Discussion (FGD) with the Business Competition Supervisory Commission (KPPU) in Jakarta on May 29, 2024.
Starlink offers a 40 percent discount on device purchases in Indonesia until June 10th, reducing the price from Rp7.8 million to Rp4.68 million. The company also provides a 30-day trial for residential and office customers, and a two-week trial for maritime and mobility services.
Telkom has expressed concerns over Starlink’s direct-to-consumer internet service in Indonesia. The state-owned enterprise hopes for government intervention regarding competition.
Previously, Telkom partnered with Starlink for backhaul services through Telkomsat. Now, Starlink can directly offer services to consumers. Telkom has also sought a partnership with Starlink for the business-to-consumer (B2C) segment.
“Starlink, inaugurated in Bali two weeks ago (May 19th), targets the B2C segment,” Telkom CEO Ririek Adriansyah told a hearing with Commission VI of the House of Representatives on May 30, 2024.
Telkomsat has been collaborating with Starlink since 2021, providing Starlink backhaul services since 2022 using government landing rights.
“Regarding direct-to-customer services, the state needs to be present,” Telkom’s Director of Wholesale and International Service, Bogi Witjaksono, said.
The government emphasizes that Starlink’s presence aims to provide access to 3T areas. However, the public can still order Starlink devices and services directly. Some users report internet speeds of up to 360 Mbps, averaging 250 Mbps.
David Brendi, also known as David Gadgetin, tested Starlink’s internet service and confirmed speeds of up to 250 Mbps.
Telkom has also targeted 3T consumers, including through IndiHome, but faces challenges in certain areas due to issues like the destruction of BTS towers and safety concerns.
