Andy Zain Explains Why the Indonesian Feature Phone Market is Awesome

Inspired by the viral article about China’s two internets – with a divide between the elite and the grassroots – we talked to our friend Andy Zain about Indonesia’s own so-called grassroots internet scene: the feature phone industry. Andy is the founder of Mobile Monday Indonesia and the director of Jakarta Founder’s Institute [1]; he explained to us that he believes the local feature phone market is the way in Indonesia, at least for the next three years, but that not a lot of people are tapping into it yet.

“I believe Indonesia is a mobile industry,” said Andy. From the 240 million people in Indonesia, 200 million of them use mobile phones, while only 18 to 19 million people have personal computers (PC). Most people first accessed the internet with their mobile phones, mostly due to Facebook and Twitter usage. He added that 80 percent of the Indonesian population use feature phones, which amounts to around 190 million people. One of the reasons for this is the low, low price of feature phones, which mostly cost below IDR 1 million ($105). He believes because the market is so big, then it should be the norm for people to provide services for it. But, on the contrary, Andy doesn’t see a lot of people tapping into the feature phone industry.

Asked if entrepreneurs should choose people with more money (by implication: smartphone owners) as their market, Andy offers a different opinion:

It’s not about who has the money, but who is willing to pay.

Feature Phone Users Lack of Options

Andy went on to explain that smartphone and PC users (himself included) are in the minority in Indonesia, and that they do not spend money over the internet – that people like him are stingy. Not only that, this minority group also has good access to alternatives, like downloading illegal music rather than purchasing it from, say, Nokia’s Ovi Store. Smartphone users love to have fun, as long as it is free of charge. That’s why they like using WhatsApp so much.

Research by Yahoo and TNS Net Index has revealed that Indonesians mostly access the internet for music and entertainment. But do we have services for those two interests? No, we don’t. People such as Andy’s maid are the ones who buy music, and they have to go to a store to buy them every month or two. No one provide these kinds of services to them, and they don’t have free music access (streaming, or piracy) like smartphone users.

Andy then said that it is not that hard to satisfy the mobile phone users in the country. He took the example of his own video project where he indexed all videos on YouTube, MetaCafe, and other sources, and made it available by converting them for feature phones. Though the picture quality wasn’t that good, it is affordable – and feature phone users are quite okay with it. Because at least now they can watch something. Who uses that service? A lot of people – Indonesia’s majority of basic mobile web users – like the night guards during their watch.

What Feature Phone Users are Like

Andy then identified that the current Indonesian feature phone users are still categorized as the first internet users in their community. For example, he helped the feature phone-based social gaming platform Mig33 increase its user-base from four million to 20 million in one and a half years back in 2008. He said that the Facebook mechanism, the one where we need to add someone first to start chatting, might not work well for feature phone users because these people don’t have any friends on the internet yet. To handle this, Mig33 opened room channels where people can just come to the room and start chatting right away and make new friends, similar to the basic mIRC method.

Typical feature phone users, Andy says, connect to the internet as an escape from their daily life, to have fun. That would explain the quirky and corny virtual identities that they want to use, with nicknames like “cutegirl19.” These people also want to look good online, and this is one of the reasons why they will want to buy premium good-looking avatars. Andy joked that the uglier the people are, the better looking avatars that they want to use.

Andy also noted that we need to understand the users’ culture. In Asian countries such as China, Japan, and Korea, virtual gifts are quite popular. In those countries, new-comers to an office might sometimes give out chocolates to the new colleagues as a way to create a good first impression. The same thing happens in virtual worlds inhabited by many feature phone users in Indonesia, where users like to give out virtual chocolates to people, even if they have to pay for it. Westerners might not understand this. He points out: “Small money, but with big benefits.”