NICOLAS SWAYA WRITES – Investing in technology is not a new concept for much of the public; we in the West especially take this for granted. But in many parts of the world, such as Indonesia, investing in technology is foreign and uncommon. According to Deloitte, fewer than 1 in 10 small businesses in Indonesia reported having advanced online capabilities; and 73% reported that they were either totally offline or had very basic online capabilities at best..
The effects of advanced technology on small businesses and the countries they reside in are massive. If Indonesia were to fully integrate internet capabilities to their public, it is estimated that they could realize a potential 80% growth in revenue. Other benefits of online capability could include a decrease in unemployment and a 17-times increase in innovation. Annual economic growth could be increased by as much as 2%. A greater online presence also increases international competitiveness, further boosting economic growth. These positive effects have been proven in nearby countries such as Japan, Singapore, and India.
Price and access are the primary reasons why Indonesian small business have yet to embrace internet capability. Indonesia and some other Asian countries are faced with very high internet prices that are almost double what the U.S. pays. These prices become further inflated when GDP per capita is taken into consideration. When these factors are accounted for, excluding Africa, Indonesia pays the most for 500MB of mobile data – a universal standard coinage.
Indonesia and other countries are, however, making rapid progress toward technological integration. Mobile phones are the most common way to access the internet, but they are used socially rather than for business purposes. Indonesia ranked fourth in the world for total number of Facebook users in 2011. The Indonesian government will play a crucial role in determining the technological future of the country. The rapid coordination and financing of this digital infrastructure will play a key role in the pace of Indonesian development in the age of the internet.