How Indonesia’s first commercial ISP keeps up with tech developments

Finding information has never been so easy. Looking for the top tech trends in Asia? Pick from thousands of sources on Google. Want to know what your friends are up to? Check their social media pages for live updates. Need directions to your lunch meeting? Get help from your favorite map app.

But 30 years ago, none of these activities were easy to do. In the 1980s, only a handful of countries in Asia had their own internet networks. On top of that, “the internet was very technical and not very easy to understand,” says Djarot Subiantoro, president director of Indonesian internet service provider (ISP) Indointernet (Indonet).

Photo credit: Adam Freidin / Flickr

Indonesia was first connected to the internet in 1983 by technologist Joseph Luhukay at the University of Indonesia, where he was a faculty member. But it was only 10 years later that Sanjaya Sanjaya, then a finance industry support manager at IBM Indonesia, got the inspiration to turn the internet into something that everyone could use.

“We had our own global network, which was connected to the internet. At first peek, all I could see was a collection of research papers and conversations between university researchers,” recalled Sanjaya in an interview for a blog post by internet address registry Asia Pacific Network Information Centre (APNIC).

“I saw such a useful information-sharing tool. I thought the Indonesian people needed that and I had to provide it to them,” added Sanjaya, who is now deputy director general at APNIC.

In 1994, he left IBM to launch Indonet – Indonesia’s first commercial ISP.

Outlasting the competition

Like many of today’s tech startups, Indonet started in a home office. Based out of a friend’s small home in East Jakarta, Sanjaya and his team worked to provide internet services to Indonesians, with the aim of improving local socio-economic conditions. But it wasn’t all smooth sailing.

“The internet was a new technology and not as widely adopted as it is now. So for three years, we were running without profit,” says Subiantoro.

Additionally, Indonet quickly saw competition from several ISPs that emerged in the mid-1990s. To get ahead of the competition, the company shifted its focus in 1999: instead of targeting individuals, it developed internet services for businesses.

Most other ISPs could not survive the surge of individuals moving to free internet services.

“We worked on building our business client base and after that, we continued to ride the wave of the internet as it grew,” shares Subiantoro. Indonet’s acquisition of a data center in 2003 also strengthened its portfolio, enabling the company to provide value-added internet services to its clients.

This turned out to be a good move as telecommunications firms started to enter the ISP market in 2007, offering a broader range of services that included free email hosting.

According to Subiantoro, while “most other ISPs could not survive” the surge of individuals moving to free internet services offered by telco operators, Indonet managed to pull through by relying on its business model as a “business enabler.”

Leveraging emerging technology

Now with sub-networks across 23 cities in Indonesia and two data centers, Indonet is working with emerging technology to provide its clients with the best service.

“Indonet’s vision is to provide the benefits of strategic tech solutions to our clients, so we aim towards cutting-edge technology and lead to market moves,” Subiantoro says. “Our ability and capacity to change while continuing to enhance our competence and our value to clients helps us remain relevant as a tech company.”

Leon Chen (left), general manager of Alibaba Cloud in Singapore and Indonesia, presented Indonet director David Tandianus (center) with the Fastest Growing Partner of Alibaba Cloud trophy at last year’s Southeast Asia Award. / Photo credit: Indonet

In 2017, the company teamed up with Alibaba Cloud, acting as the main distributor of the Chinese provider’s cloud computing services in Indonesia.

The partnership has seen successful for both parties: Alibaba Cloud gained entry into the Indonesian market while Indonet has been able to grow its market share “by more than 100 percent,” notes Subiantoro.

Looking forward

Indonet has also started looking into other emerging technologies such as artificial intelligence, big data, and internet of things to stay ahead of the game.

Indonet president director Djarot Subiantoro (second from right) with Indonet partners at the announcement of its hybrid cloud solutions and services in 2018. / Photo credit: Indonet

“We don’t see other ISPs as our competitors – our competitor is the situation,” says Subiantoro. “We want to get ahead of market requirements so that we don’t have to compete with others. Because if we are competing with others, that means that we are not changing fast enough.”

With the number of tech startups thriving in Indonesia, Subiantoro says that going forward, he wants to “learn from the new types of businesses and unicorns” to see how he can make Indonet “more efficient and better” as a company.

“We are still conservative. We still maintain profits and return to stakeholders. But if you look at the new companies, they focus a lot on corporate values,” he points out. “You have to always learn what’s going on around you and what opportunities are out there.”

Alibaba Cloud is the cloud computing arm of Alibaba Group. It provides a comprehensive suite of global computing services to businesses worldwide, including merchants doing business on Alibaba Group’s marketplaces as well as with startups, corporations, and government organizations. Indonesian ISP Indonet entered a strategic partnership with Alibaba Cloud in 2017 and subsequently took over its Indonesia operations.

Find out more about Alibaba Cloud’s range of cloud services here.