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Local content rule be applied in software
A local-content requirement for smartphone manufacturing should not be imposed solely on the hardware but also on software and apps, according to a government official
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local-content requirement for smartphone manufacturing should not be imposed solely on the hardware but also on software and apps, according to a government official. An expanded requirement such as this would drive technology development by local brains.
The Industry Ministry's director general for metals, machinery, transportation equipment and electronic industries, I Gusti Putu Suryawirawan, said that a lot of the talk on the local-content requirement revolved mostly around hardware and design proportions, while the software aspect seemed to be overlooked.
Suryawiryawan argued that the telecommunications industry should emphasize local software such as mobile apps as it would more efficiently step up development.
'Hardware can only go so far in terms of implementation, which is why the ministry is pushing for mobile apps and the like to be included within the 30 percent local-content requirement. Apps catch our eyes first when we turn on our smartphones and it will definitely push development in the local technology industry,' Suryawiryawan said recently.
Beginning in 2017, the government has decreed that all 4G smartphone manufacturers will have to manufacture using local components amounting to a minimum of 30 percent in an effort to promote the country's growing cell phone manufacturing sector.
Suryawiryawan added his ministry would like to see further growth in the telecommunications industry through the construction of more base transceiver stations (BTS) and through an emphasis on smartphone software.
'We are aware of the lack of infrastructure within Indonesia's component production industry. We would also ask any industry collaborators to consider the software field due to its sheer importance and the major role it plays in pushing our technology further,' he said.
Foreign smartphone producers such as Samsung, Apple, BlackBerry, Lenovo and Xiaomi have all said that they would comply with the ruling.
Meanwhile, Communications and Information Minister Rudiantara said that local-content requirements could potentially boost the affordability of 4G smartphones and could support the increase and use of 4G technology in Indonesia.
'We must also try and think of ways to make the technology more accessible to the public. The 4G ecosystem will continue to develop itself if the technology becomes more affordable,' he said.
The country's four largest telecommunications operators have just finished frequency refarming efforts in order to prepare their networks to accommodate the better quality 1,800 MHz spectrum 4G/LTE network. However, despite the conclusion, Rudiantara previously noted that the operators had yet to outline clear business plans for the usage of the new network.
As of Friday, PT XL Axiata was the only one out of the four operators to have officially launched and announced their revamped 4G/LTE service. Indosat Ooredoo plans to launch their network next week.
The communications and information ministry has estimated that the total value of foreign smartphones sold in Indonesia reached between US$5 billion and $6 billion last year.
