Fake news or hoaxes are a serious problem that can cause social unrest and even jeopardize political stability. Over the past months there were several hoaxes that spread rapidly across Indonesia, usually through social media platforms because these platforms have become a key source of information for the roughly 100 million Indonesian Internet users. Hoaxes included an invasion of Chinese workers, a communist revival, and a blasphemous speech of Jakarta Governor Basuki Tjahaja Purnama (Ahok).

Especially this last case is interesting and alarming at the same time. After a manipulated video of Ahok surfaced on social media in which he insults Islam, Islamic hardliners staged several massive demonstrations in Jakarta. In fact, pressure on Indonesian authorities was so high that this case went to court, a sad example of the power of "the hoax" as well as the power of hardline Muslims.

Indonesian authorities urge social media platforms such as Facebook to combat the spread of fake news and it would help if Facebook sets up a local company in Indonesia. Rudiantara said this would ensure better quality services, while Facebook would be able to familiarize itself with Indonesian perspectives and the local cultural context (the local context determines the degree of sensitivity of the fake news message; a fake news topic that may be harmless abroad can be a major issue in Indonesia). According to Rudiantara, Twitter, which has set up a proper company in Indonesia, is much quicker to respond to "negative content", which include hoaxes and pornography, because they have a better understanding of the local culture.

Between early 2016 and the beginning of 2017, Indonesia's Ministry of Communications and Information received 1,572 complaints related to "negative content" on social media platforms Facebook and Instagram.

Besides the issue of fake news (and having more government control of the content on Facebook), having a local company would also make Facebook a more interesting taxable entity in Indonesia. Indeed Facebook's representative office in Jakarta is a taxable entity but earnings are booked at the company's regional office in Singapore.

Number of Social Media Users (in million):

World Indonesia
Facebook 1,788     88.0
WhatsApp 1,000     12.3
 500     28.0
Line  220     30.0
Twitter  313     16.8

Source: Investor Daily