Indonesian telecom market set for data-driven growth

Details: Manny Pham; Category: Operators; 12 December 2025; 9680 views

Telecom services revenue in Indonesia is predicted to grow at a Compound Annual Growth Rate (CAGR) of 3.7% between 2024 and 2029, a trend underpinned by the increasing adoption of mobile data and fibre connectivity.

According to a report by analyst house GlobalData, Indonesian consumers are rapidly shifting their preferences from traditional voice services toward data consumption. This shift underscores a strong push by operators toward higher-value services, specifically 5G and Fiber-to-the-Home (FTTH). GlobalData suggests this heralds a "competitive phase marked by infrastructure upgrades, premium plans, and widening access that will redefine user experience and market structure."

Mobile sector shifts

During the forecast period, mobile voice service revenue is anticipated to decline. This is due to operators increasingly bundling voice minutes for free into mobile plans, coupled with users showing a strong preference for Over-The-Top (OTT) internet communication services (e.g., WhatsApp, Telegram).

Conversely, mobile data revenue is set to climb sharply, projected to increase at a CAGR of 5.3%. This rise will be fuelled by higher revenue-producing 5G services, which will, in turn, boost the Average Revenue Per User (ARPU). The introduction of large and unlimited data plans will further contribute to this mobile data revenue growth.

GlobalData analyst Srikanth Vaidya notes that 4G remains the majority share of mobile subscriptions and will continue as the "leading mobile technology" throughout the forecast period. However, Vaidya predicts that 5G subscriptions will "increase at a faster pace" as Mobile Network Operators (MNOs) continue to spread their 5G coverage.

Operator activity reinforces this focus: Telkomsel was highlighted for extending its 5G network in the city of Batam, adding 5G base stations in key areas such as Harbour Bay, Nagoya, Batam Center, Engku Putri, and Hang Nadim Airport, bringing its total number of active base stations (BTs) to about 112 in that area.

Fixed communications outlook

Other communication segments will also experience a revenue drop, particularly within fixed communications. Fixed voice service revenue will decrease at a CAGR of 2.5% due to a decline in circuit-switched subscriptions and falling voice ARPU levels. Fixed broadband service revenue, however, will grow robustly at a CAGR of 4.5% over the 2024-2029 period, driven almost entirely by the growth in FTTH subscriptions.

This growth aligns with a general increase in demand for high-speed broadband connectivity, necessitating the continued expansion of fiber optic network infrastructure by the Indonesian government and telcos throughout the forecast period.

Vaidya concluded that Telkomsel will maintain its position as the market leader in mobile services, leveraging its extensive 97% 4G population coverage and "aggressive efforts" in deploying 5G. As of mid-2025, the operator reportedly possesses 3,000 5G base stations across 56 cities.