<img class="alignnone size-full wp-image-1565" alt="Page - Context - Internet industry structure graphic 2" src="http://redwingconsulting.com/wp-content/uploads/Page-Context-Internet-industry-structure-graphic-2.jpg" width="700" height="250" />
<h4 style="text-align: justify;">While the top 5 Indonesian websites are still dominated by the global internet players, local sites in the categories of news, community-based services, e-commerce and entertainment continue to rise up the rankings. A number of the local media companies have established a strong online presence, and some of the big players from China and Japan have now entered the market, but it is still too early to tell who the future internet giants will be in Indonesia.</h4>
<h5 style="text-align: justify;">Global players currently dominate the rankings, but local sites are catching up</h5>
<p style="text-align: justify;">The top 5 visited websites in Indonesia are currently Google, Facebook, Blogspot, YouTube and Yahoo, and the top positions have always been held by the global players - unlike China, the government of Indonesia does not place any restrictions on access to foreign websites.</p>
<p style="text-align: justify;">However, the local sites are making rapid progress, and there are now 22 Indonesian sites in the top 50, compared to 12 sites just a year ago.</p>

<h5 style="text-align: justify;">The local top 50 contains a mix of mature websites and young startups</h5>
<p style="text-align: justify;">Four main types of internet services account for most of the top 50 local sites:</p>

<ul>
	<li>News and entertainment portals</li>
	<li>Community-based services</li>
	<li>E-commerce and payment platforms</li>
	<li>Entertainment services (gaming, videos, etc)</li>
</ul>
<p style="text-align: justify;">Interestingly, each of these categories contains both mature websites and young startup companies:</p>
<p style="text-align: center;"><img class="size-full wp-image-1087 aligncenter" alt="Page - Analysis - Internet industry structure table 2" src="http://redwingconsulting.com/wp-content/uploads/Page-Analysis-Internet-industry-structure-table-2.png" width="650" height="169" /></p>
<p style="text-align: justify;">The group that is noticeably missing from the Indonesian internet industry at the moment is the offline retailers. None of the major department stores, grocers or specialty retailers have yet gone online in a big way, which many believe is due to their heavy investments in malls and outlets and their belief that online retailing does not yet pose a severe threat.</p>

<h5>A number of support platforms have emerged</h5>
<p style="text-align: justify;">Obviously a critical part of the internet industry is finding sustainable ways to monetise online services, in particular e-commerce sites. A number of payment platforms are competing to establish themselves as the industry leaders, and KlikBCA, Mandiri, Doku, iPayMu, Veritrans, Jatis and Kaspay have all established themselves to varying degrees in different parts of the online payment market.</p>
<p style="text-align: justify;">The other main monetisation route is through advertising. Online ads are delivered through the major platforms such as Facebook, Google and Twitter, with Google pushing hard to promote its Adsense and Adwords programs among local businesses. Also, since Indonesia is a mobile-first market, the major mobile advertising platforms are very active in Indonesia, including Opera, InMobi, AdMob, BuzzCity and MobPartner. Ad impression volumes are extremely high - InMobi alone is now delivering more than 30 billion mobile ads per quarter.</p>
<p style="text-align: justify;">But one of the exciting things about Indonesia is that traditional online payment methods and mobile advertising both miss large parts of the market. Of the 240 million people in Indonesia, only 15 million have credit cards and 60 million have debit cards. So there is a huge swathe of users who are potential revenue-generators for internet companies, but who can't easily be reached with the usual payment platforms.</p>
<p style="text-align: justify;">As a result, a number of innovative online payment methods are likely to emerge that are particular to Indonesia, with potentially huge rewards for those who get the approach right.</p>

<h5>Major players are coming in to the market</h5>
<p style="text-align: justify;">A number of billion dollar technology companies have established Indonesian ventures in the past two years: notably Rakuten (Japan), Tencent (China), Rocket Internet (Germany) and Google (USA), each taking a slightly different approach to market entry.</p>
<p style="text-align: justify;">In addition, some of Indonesia's biggest companies such as Djarum, Bakrie, MNC, CT Corp and Kompas Gramedia Group have also begun operations.</p>
<p style="text-align: justify;">Yet despite the millions of dollars of investment funding that sits behind their ventures, it is not yet clear which of them will emerge as long-term winners.</p>
<p style="text-align: justify;">The Amazons, Taobaos, eBays, Facebooks, PayPals and Tencents of Indonesia are nowhere near to being anointed yet.</p>

<h5></h5>
<h6>Sources: Bank Indonesia, e27, Alexa, Daily Social.</h6>