Faisal Maliki Baskoro, Jakarta – Indonesia's push to attract foreign investment risks losing momentum as the country falls behind Southeast Asian peers in deploying 5G networks that multinational manufacturers increasingly view as critical infrastructure.
While global 5G subscriptions have passed 2 billion, Indonesia's 5G coverage reaches only about 5% of the population, according to industry estimates. That compares with far broader rollouts in Vietnam, Malaysia and Thailand, where regulators have moved more quickly to release spectrum and encourage operators to deploy stand-alone 5G networks capable of supporting industrial applications.
The gap matters because 5G is no longer just about faster mobile speeds for consumers. Unlike earlier generations, the technology allows operators to deliver guaranteed performance and ultra-low latency for factories, ports, hospitals and logistics hubs that can increase productivity, efficiency and operating costs.
"If it's for enterprises, it's different," Magnus Ewerbring, Asia-Pacific chief technology officer at Ericsson, said in an interview. "You can do your business in Vietnam or Malaysia or Indonesia, and if the infrastructure is well-developed in one country, it's a big advantage."
Ronni Nurmal, vice president and head of government and industry relations at Ericsson Indonesia, said 5G readiness is increasingly shaping cost comparisons between countries. "Having 5G for enterprise will increase productivity and efficiency," he said. "If the same company can save 20% in Vietnam compared with investing in Indonesia because the infrastructure is already there, then we are competing directly with countries that have moved faster."
Vietnam and Thailand have positioned themselves aggressively. Vietnam has expanded 5G trials and early commercial deployments across major industrial zones. Thailand, meanwhile, has promoted 5G as part of its Eastern Economic Corridor strategy, targeting automation, robotics and smart logistics to attract electronics and automotive investment.
Malaysia has also moved ahead. State-backed Digital Nasional Bhd has deployed 5G nationwide under a wholesale model, allowing enterprises to tap high-performance connectivity without waiting for individual operators to build parallel networks.
Indonesia's challenge lies in both spectrum availability and cost. The country has allocated relatively small blocks of spectrum for 5G compared with regional peers, limiting network capacity and performance. Operators have also repeatedly flagged high spectrum fees as a constraint, arguing that capital would be better spent on expanding coverage and upgrading networks than on upfront licensing payments.
In contrast, India, with its large population, released large swathes of spectrum at scale, enabling operators to roll out 5G nationwide at speed. The result has been rapid adoption, falling device prices and growing enterprise use.
Subscriber uptake in India has accelerated alongside sharply lower handset costs. According to Ewerbring, 89% of smartphones sold in India in the third quarter were 5G-capable, with the lowest-priced segment – ranging from about $70 to $110 – driving much of the growth
The Indonesian government aims to expand 5G connectivity to cover 32% of the population by 2030, with deployment expected to broaden gradually in line with demand growth and ecosystem readiness.
Ewerbring said regulatory choices over the next few years will be decisive. Lowering spectrum fees while imposing clear coverage and deployment obligations could accelerate rollout and help close the gap with regional competitors.
According to the Ericsson Mobility Report 2025, global 5G subscriptions are expected to reach 2.9 billion by the end of 2025, accounting for about one-third of all mobile subscriptions. The total is forecast to climb to 6.4 billion by 2031, representing roughly two-thirds of all mobile subscriptions worldwide.
In Southeast Asia and Oceania, 5G subscriptions are forecast to reach about 680 million by 2031, as the technology evolves beyond basic coverage toward differentiated connectivity and high-value enterprise use cases.
"The next five years are critical," he said. "Countries that reach maturity in 5G coverage and usage by the end of the decade will see more innovation and stronger productivity growth. Those that don't will find it harder to compete."
Currently, 5G services in Indonesia are available in several major urban areas – including Greater Jakarta, Bandung, Surabaya, Batam, Makassar, Surakarta, Denpasar and Medan – often limited to central business districts or specific hotspots.
Source: https://jakartaglobe.id/tech/slow-5g-adoption-threatens-indonesias-appeal-to-foreign-investor