It has been a while since we last reported on developments surrounding the Palapa Ring project, one of Indonesia's priority infrastructure projects in the 2016-2019 period. The Palapa Ring, which involves an undersea fiber-optic cable network that stretches across 13,000 kilometers as well as an onshore network of nearly 22,000 kilometers, will provide fast broadband Internet to Indonesians in both the urban and rural areas across the country. Once completed, all Indonesian districts (kabupaten) are connected through fiber-optic communication.
The Palapa Ring project is divided into three sections: West, Central, and East. Each section is developed by a different consortium. The project is known as Indonesia's first government-to-business cooperation scheme within the nation's telecommunication sector and utilizes the so-called "availability payment method". The consortia are Palapa Ring Barat (West section), LEN Telekomunikasi Indonesia (Central section), and Palapa Timur Telematika (East section).
Rudiantara, Indonesian Minister for Communications and Information (who - like many Indonesians - goes by one name), said he is optimistic that the Palapa Ring project can be completed before the end of 2018. This would allow the full operation of the network in 2019. Currently, the West section of the Palapa Ring is completed for 95.01 percent (and in fact it is already in use). This section is important because the western part of the country (specifically the islands of Java and Sumatra) is the most populous part of Indonesia and therefore can expect to see huge traffic.
However, in terms of equality and poverty eradication the Central and East sections are even more important. The lowest Internet penetration and (relative) poverty rates can be found here (particularly in the far eastern part). Although many people cannot (yet) afford a smartphone in these regions, it should lead to more equality in the future. Moreover, better Internet connection - implying better communication - in these regions should improve various social problems (for example related to healthcare) and should also lead to improved governance.
The Central section of the Palapa Ring is now estimated to be completed for 71.96 percent and therefore it is indeed highly likely to be fully completed before the end of the year. The East section, however, is only completed for 32.76 percent and therefore we believe it will difficult to complete this section before the start of 2019. The eastern part of Indonesia is definitely the most challenging when building a fiber-optic cable network.
Currently, fast Internet in Indonesia is primarily available in the urban regions on Java and Bali. The five Indonesian cities with the fastest Internet connection are Bandung, Bekasi, Jakarta, Surabaya ad Tangerang (all on Java). Outside the islands of Java and Bali, the Internet connection in Indonesia tends to be slow and expensive.