The world's Internet giants that provide services in Indonesia (such as social media platforms) are encouraged to establish a permanent presence in Indonesia in the form of a representative office or foreign investment company (PT PMA) hence becoming taxable entities. If not, their services can be blocked by Indonesian authorities. Finance Minister Bambang Brodjonegoro informed reporters about this plan on Monday (29/02). Although he declined to mention any names, it is assumed Brodjonegoro refers to social media platforms and those that sell products/services to the massive online audience of Indonesia.

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Indonesia is in the news today after it was reported that the government ordered all instant messaging providers - for example Line, Twitter and WhatsApp - to remove gay emoticons (such as same-sex couples holding hands or making kiss gestures at each other). Through this removal the government tries to safeguard the local culture and (religious-inspired) ethics hence protecting the nation's children from an example of bad western behavior.

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Twitter, the online social networking and microblogging service, plans to open an office in Jakarta within the next six months as the number of Indonesian Twitter users has grown rapidly in recent years. In 2013, Indonesia had 29 million Twitter users, making it the world’s fifth-largest Twitter community after the USA, Brazil, Japan and the UK. The American social media giant already owns five offices in the Asia-Pacific region. Similar to other companies, Twitter waited until after the elections before expanding to Indonesia.

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Line, a free social network from Japan which provides applications for instant messaging on smartphones and personal computers, had about 30 million Indonesian users at the start of August 2014 (total global users of Line stood at 490 million around the same time). Most of Line Indonesia’s revenue, approximately 60 percent, is accounted for by games, followed by stickers and official accounts (each contributing twenty percent to the company’s revenue). However, Line Indonesia refrained from mentioning absolute financial figures.

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The number of Indonesian Internet users grew 13 percent (year-on-year) to 71.2 million in 2013 according to data provided by the Association of Indonesian Internet Providers (APJII). Overall, Internet penetration in Indonesia now stands at around 28 percent of the country's total population of over 240 million people. The number of Internet users in Indonesia is expected to grow to 107 million in 2014 and 139 million in 2015 based on the Millennium Development Goals. However, the sector needs government support to achieve these numbers.

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The Indonesian Internet Service Providers Association (Asosiasi Penyelenggara Jasa Internet Indonesia, abbreviated APJII) expects the number of Indonesian Internet users to increase between 20% and 30% to 80 million people at end 2013. With Indonesia's current population numbering about 240 million people, it means that Internet penetration will grow to 33.3%. This development means that both Internet services providers and the Indonesian government should provide supportive conditions to accommodate increased Internet usage.

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Rudiantara, Indonesia's Minister for Communications and Information, urges social media platform Facebook to upgrade its existing representative office in Indonesia into a proper company (PT PMA). Earlier this week Rudiantara met a Facebook delegation, led by the head of global policy management Monika Bickert, in Jakarta. Indonesian authorities believe that by having a proper company in Indonesia, Facebook would be in a better position to tackle negative content and fake news (hoaxes), while communication with the government would improve.

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Indonesia's Communication and Information Ministry urges American multinational technology company Google to set up a permanent establishment in Indonesia. This way Google, which is owned by US multinational conglomerate Alphabet Inc, would need to start paying taxes to Indonesian authorities. Currently, Google only has a representative office in Indonesia, while transactions and revenue generated in Indonesia are booked at Google Inc's Asia Pacific headquarters located in Singapore.

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