The Economist takes a look at the untapped potential of internet usage in Indonesia, where fewer than 20% of the 230 million population are online and most access is via mobile devices. Online business models heavy with advertising revenue and e-commerce solutions, common in the West, are less effective in a country where many do not have credit cards or even bank accounts.

Indonesia does have several factors in its favor, though: its population has embraced social networking with great enthusiasm, building Facebook’s largest user base outside the USA (despite having no local office) and producing a home-grown social/check-in network Koprol, recently acquired by Yahoo!. Mobile devices are dirt cheap thanks to Chinese manufacturers and their $30-40 devices, and Indonesian network access is so affordable it’s often preferred by Indonesian expats in other countries over local providers.

Online services are looking for inventive alternatives for smaller transactions, such as selling credits and e-currencies for use exclusively within the network, or arranging barter trades. Sites like Mig33 and Indomog have set up their own social/commerce ecosystems for their communities. The article also wonders if Indonesians’ special willingness to socialize online might make it an attractive test market for other products and services looking to move into Asia, creating an interesting potential for new ideas.

source & article: The Economist