The internet is having a profound impact Indonesia’s media landscape, and overtook print and radio for the first time in 2012 in terms of reach. While television is still the dominant medium with near-100% monthly reach, all the media conglomerates are currently either implementing or conceiving online digital strategies. The young and tech-savvy consumer base is highly social media aware, and supports a huge advertising market that will soon exceed US$10 billion.
A large, dynamic and open media market with television at the forefront
Television dominates the media landscape in Indonesia – 97% of the population watch television each month, which means a TV audience of almost 240 million people. As a result, a large proportion of advertising spend goes to television – around 60% in 2011. National channels dominate the market, with local channels only holding a 3% share of viewers.
Television therefore plays a major role in setting agendas in Indonesia, from politics to market trends to consumer fads. Coupled with social media, it can result in huge audiences and user bases across the nation – witness the 1,000+ episodes in just four years of the top soap opera Cinta Fitri, or the 55 million Indonesian supporters of Manchester United Football Club.
Significantly, the internet became the second most widely-viewed medium in 2012, overtaking both newspapers and radio to achieve a monthly reach of 57% of the population. Behind newspapers and radio, magazines trail at a distant fifth with a 12% market reach.
While the growth of the internet is clearly changing media consumption habits in Indonesia, the rapid expansion of the overall consumer market means that all media markets are still growing. As an example, although the overall reach of newspapers fell slightly in 2011, circulation numbers rose by 25% during the year.
A substantial base of media outlets
Television is ubiquitous in Indonesia, with 11 national TV stations in Indonesia, 10 privately-owned channels and 1 public channel. These are complemented by 350 local TV stations.
Cable and satellite TV are still relatively small markets, with 2.5m households in 2012, representing a 4% household penetration. Subscriptions are almost exclusively among the A and B social groups, and high prices have inhibited growth to date. Although the level of competition is increasing, the household penetration rate is only expected to rise to 7% by 2015.
Despite the large number of titles in print, newspapers still have a relatively low circulation, Total circulation for the 172 daily newspapers in the entire country totals only six million, with the largest newspaper, Kompas, having a circulation of around 500,000.
Radio is the other widely spread media format in Indonesia, reaching over half the population each month. In addition to the 1,250 radio stations there are numerous small-scale community radio stations. There is a notably long prime-time each workday from 6-10am and 3-7pm as city-dwellers fight their way through the notorious and ubiquitous macet (traffic jams).
There are 1,100 print media publications in Indonesia, a mix of foreign and local titles, covering the full range of fashion, lifestyle, business, sport and entertainment genres.
Advertising market will reach US$10 bn in 2013
Indonesia has a huge advertising market, which is forecast to reach US$10bn in 2013. To put this in perspective, Indonesia’s ad market is larger than India’s, despite having only a fifth of the population size.
A second significant category by global standards is mobile ads, which grew by 100% in 2012. With an estimated 200 billion ad impressions delivered in 2012, Indonesia was the second largest market for mobile ads in the world, beaten only by the US.
Social media are ubiquitous
Indonesia has gained a reputation as the social media capital of the world, and the reputation is richly deserved. Not only is the penetration of social media high – Indonesia is among Facebook’s and Twitter’s largest global markets – but Indonesians are also some of the most active users of social networking. Nearly nine out of every 10 internet users in Indonesia regularly use a social network, and Indonesians make an estimated 6 billion views per month on social networks.
Unsurprisingly, younger people dominate the social media user bases, with 70% of the Indonesian Facebook base aged under 25. In addition, 75% of Facebook users in Indonesia access the site via their mobile phone, again showing the importance of mobile in the modern media market.
Facebook now has around 47 million users in Indonesia, although growth has plateaued over the past six months and we are hearing increasingly frequent pieces of on-the-ground evidence that Facebook may be on the wane. Twitter on the other hand is growing very rapidly, more than doubling in 2012 to nearly 30 million users.
Regardless of who owns the users, social media will continue to be huge in Indonesia for the coming years, and other Indonesian services such as mig33 and Koprol were also among the world’s fastest growing social networks in 2012. These widespread social media networks, together with huge television audiences, combine to make Indonesia an extremely dynamic and fast-moving market for both broadcast and interactive media.