Netflix blocked by Indonesia’s largest telco, accused of porn and noncompliance

Image by Brian Cantoni

Earlier today, local media IndoTelko reported that Indonesia’s largest telecommunications enterprise network service provider Telkom has blocked television and movie-streaming service Netflix. The block has been effective since 12 am today.

Users are reportedly unable to access Netflix from any Telkom service, including IndiHome, WiFi.id, and mobile carrier Telkomsel. The telco conglomerate is one of Indonesia’s largest state-owned enterprises. The news comes just days after the Indonesian government gave Netflix one month to comply with the nation’s regulation on film and broadcasting, which includes setting up a local business entity, paying taxes on every transaction, and hiring local staff.

Dian Rachmawan, the firm’s director of consumer service, tells the media Netflix contains pornographic material and other inappropriate content. Additionally, Netflix didn’t have permission to enter Indonesia, which is why Telkom is blocking the service now.

Scene from Netflix series Orange is the New Black.

See: Netflix given 1 month to get legal and pay taxes in Indonesia

A threat to Indonesia’s economy?

DailySocial quoted Rachmawan as saying, “As a state-owned enterprise, we need to set up an example and authority in conducting businesses.” He added that Telkom would be willing to partner with Netflix so long as it removed inappropriate content, and proceeded to let Telkom “help it manage” itself in Indonesia through a Telkom-owned platform.

The country’s tech minister, Rudiantara, echoed this sentiment earlier in the month. However, he did say that he probably would not ban Netflix. Instead, he hopes the US-based company will work with internet service providers and get itself a business license as a local content provider. It seems when push comes to shove in terms of Netflix’s compliance, a ban via its state-owned telco is the only way the government can show US-based Netflix that it’s not playing around.

The ban is sure to be controversial for many reasons, but perhaps the main one is that the government insists on imposing regulations on foreign tech companies, on the sole condition that they’re rich. In the past, Rudiantara said he must use his policies to bolster the nation’s trade deficit. An important question is: How does Netflix’s presence in Indonesia harm the nation’s macroeconomy? The firm is not dealing with physical goods, but instead offering one more option for people watch TV online.

Odds are, porn and questionable content on Netflix is not the real reason behind Telkom’s ban. Instead, a more relevant fact is that Netflix sees annual revenue of US$6 billion, which may be too juicy to pass up.

This story has been unfolding in Jakarta since Netflix launched in Indonesia – alongside 129 other new markets – on January 7.