Indonesians Still Love Their BlackBerrys

... Or at least they’re slower to give them up than other populations | RIM is refocusing on Indonesia, a market it “cannot afford to lose”

Bruce Einhorn, with Harry Suhartono

Thousands stormed a mall in Jakarta last year to buy up discounted BlackBerrys


For Sanuri, a customer service technician at a Jakarta electronics chain, buying a phone is a big decision. The 28-year-old father of one (who like many Indonesians has only one name) makes about $160 a month, minimum wage in the Indonesian capital. But like many Jakarta residents, he’s willing to spend more for an impressive-looking phone. Last year he decided to get rid of his old Nokia in favor of a $440 BlackBerry Torch. To finance it, he had to get a loan from his employer.

The phone was worth the expense, says Sanuri, who relies on the free BlackBerry Messenger service to keep in touch with colleagues and schedule client visits. “Everyone knows what the others are doing,” he says. Even though Indonesian retailers are offering more alternatives to BlackBerry, Sanuri isn’t switching. “There are more benefits I can get from BlackBerry,” he says.

While smartphone users around the world are tossing their BlackBerrys and buying Google’s Android-powered phones and Apple’s iPhones, Indonesia remains a rare bright spot for Research In Motion. The global market share for the Waterloo (Ont.)-based company’s smartphones fell to just 4.3 percent in the third quarter of this year, down from 9.5 percent in the same quarter of 2011, according to market research firm IDC. Yet in Indonesia, the BlackBerry operating system accounts for 37 percent of the market. RIM is still losing ground there, just not as quickly as elsewhere (in 2011, BlackBerrys accounted for 43 percent of the market). Android is now the top operating system, but BlackBerry remains ahead of the 2.5 percent share for No. 3 Apple iOS, thanks largely to the dominance of BBM. Indonesians also like RIM’s low-cost BlackBerry Internet Service plans such as BIS Social and BIS Lite that offer access to social networking sites like Twitter and Facebook for as little as $4.69 a month.

“Any retailer has to have BlackBerry,” says Ryota Inaba, chief executive officer of Rakuten Belanja Online, an e-commerce joint venture of Japanese online retailer Rakuten and Global Mediacom, Indonesia’s biggest media company. Indonesia “is the market for RIM.” Inaba is a BlackBerry user himself, albeit a reluctant one. “I don’t like using BlackBerry, to be honest,” he says. But few of Inaba’s 40 staff members have high-end smartphones and a lot of them don’t even use e-mail, preferring instead to chat over BBM. “BlackBerry is the fastest way to communicate,” says Inaba, who sends about 20 instant messages a day via the BBM service.

Indonesia isn’t as coveted a market as China or India, but it does have the world’s fourth-largest population (some 242 million people), and its economy is expected to increase more than 6 percent this year. RIM clearly views it as a market worth protecting. Singapore-based spokesman Benjamin Chelliah says RIM is “currently investigating” launching a new money transfer system for its Indonesian BBM platform. RIM is also trying to foster Indonesia’s growing app developer community. In October, RIM opened a BlackBerry Innovation Center at the Bandung Institute of Technology to provide scholarships and other financial support to young engineers working on BlackBerry mobile apps; the same month, RIM CEO Thorsten Heins traveled to Jakarta to promote the brand.

In late November, RIM hosted a two-day conference for app developers in Bangkok, part of a campaign to build interest ahead of the January launch of its new operating system, BlackBerry 10. Regional managing director Urpo Karjalainen told attendees that RIM is “absolutely committed” to Asian markets, and that its “unique BlackBerry service has been the foundation of our success here.”

Fending off competition and slowing its market share slide won’t be easy. Google’s Android operating system has been making significant inroads into Southeast Asia. Samsung has been the main beneficiary, with its smartphone market share doubling from a year ago to 40 percent. RIM’s share across the region is now 14 percent, down from 18 percent in 2011. Nokia is taking aim at Indonesia too, announcing on Dec. 4 the launch of two Lumia smartphones using Microsoft’s Windows 8 operating system.

In response, RIM and retailers are offering cheaper BlackBerrys priced around $100. “There’s going to be a little bit of an OS war,” says Sudev Bangah, country manager in Jakarta for IDC. As that fight heats up, aggressive pricing and new BBM services will allow “RIM to reinvent itself in a market it cannot afford to lose.”

The new operating system will probably have limited impact on Indonesians in rural areas, who prefer cheaper phones. But for the upscale market, a pricey new BlackBerry might draw interest in Jakarta, where people “are willing to spend a little bit more,” says Bangah, who expects the new OS to boost BlackBerry shipments next year. In Indonesia, at least, RIM’s not finished yet.

The bottom line Even in Indonesia, where they’re still popular, BlackBerrys are losing ground, going from 43 percent of the market last year to 37 percent.


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