Indonesia's Apple and Google block Indonesian tech fans | Modern


Medan, Indonesia – Winston, a doctor who lives and works in the capital of North Sumatra Province, is a self-proclaimed Apple enthusiast.

Currently the proud owner of the iPhone 15, Winson was looking forward to upgrading to the latest model, the iPhone 16, which was released in September.

Winston, however, has reluctantly abandoned the idea since the Indonesian government banned sales of the iPhone 16 and Google Pixel in late October, citing the failure of tech giants to comply with the country's Tingkat Komponen Dalam Negeri, or TKDN, policy, which requires phones to get at least 40 percentage of their shares there.

“Indonesian laws regarding iPhones hit me once, and once was enough,” Winston, who like many Indonesians goes by one name, told Al Jazeera.

Although Winston was able to buy an iPhone overseas to bring home – a common practice that is legal as long as the phone is not resold – he has been burned by Indonesian law in the past.

“I bought an iPhone 11 in Singapore in 2019 because it was cheaper than in Indonesia, about $250 really cheap. A round trip ticket to Singapore at that time was only $120. You could fly to Singapore and back to Indonesia on the same day, so it was cheaper, he said.

Winston used the phone without problems for about a year, until the Indonesian government in 2022 passed a law requiring all phones to be registered.

Although he registered his phone as required, the device suddenly went missing one day and would not connect to the network again, even with a different SIM card, he said.

“I went to an authorized Apple dealer in Medan because I thought there was a problem with the phone, but they just said, 'There is nothing we can do or offer,'” he said.

Owning an unused iPhone, Winston, who had never had a problem with his current iPhone 15, which he bought through an authorized dealer, sold the device at a loss at a second-hand shop during his next trip to Singapore.

Pixel
The new Pixel 9, 9 Pro and 9 Pro XL phones at Google's Bay View campus in Mountain View, California on August 13, 2024 (Josh Edelson/AFP)

Indonesia, the fourth most populous country with about 280 million people, is one of the world's largest mobile phone markets.

The islands had about 190 million mobile users in 2022, according to market research firm Newzoo.

According to figures from the Ministry of Industry, the country shipped about 22,000 Google Pixel phones and 9,000 iPhone 16s in 2024, before the government announced the ban.

Smartphone exports to Indonesia were dominated by devices made by Xiaomi, China's Oppo and Vivo, and South Korea's Samsung.

Abdul Soleh, a lawyer in Medan, said the low price of the iPhone 16 for many Indonesians could explain why there was little opposition to the ban.

“It's a real shame, because iPhones are very popular and have a lot of users in Indonesia,” Soleh told Al Jazeera.

“It would be good if the iPhone 16 could be sold in Indonesia because there are many fans here.”

Khairul Mahalli, head of the Chamber of Commerce in North Sumatra, said that although the Indonesian TKDN plan aims to support local companies, it may have unexpected consequences.

“As a member of the World Trade Organization (WTO) and a business that operates between countries, it is good to protect our industries, but we also have to have checks and balances,” Mahalli told Al Jazeera.

“One of the things that may happen in the future is that, when Indonesia bans the sale of certain products, other countries may do the same and will no longer accept the sale of Indonesian products in the international market.”

Mahalli said it is the duty of the government to find ways to reduce the damage to local industries that are not too difficult compared to the actual prohibition of foreign products.

“We should not completely ban foreign trade, because Indonesia's market is large enough to absorb foreign products due to the population of more than 270 million people,” he said.

“We have to look at whether local production can meet the needs of consumers.”

Rio Priambodo, head of the legal and complaints department at the non-profit Indonesia Consumers Organization, said consumers should think twice about buying the latest iPhone model, especially through illegal sellers in the country.

“The Consumers Organization recommends that consumers do not try to buy the iPhone 16 in any way if it has been banned by the government,” Priambodo told Al Jazeera.

“If products are being sold illegally, this will undermine the consumer protection that all customers should have.”

In order to resolve the dispute, Apple has promised to increase its investment in the country to lift the ban.

In November, the California-based tech giant committed $100m to the country over two years, a 10-fold increase from its previous pledge of $10m to build an equipment and materials factory in Bandung, West Java.

Minister of Industry Agus Gumiwang Kartasasmita
Apple CEO Tim Cook, center, walks with Indonesian Industry Minister Agus Gumiwang Kartasasmita, right, and Minister of Communication and Information Technology Budi Arie Setiadi, left, after a meeting with President Joko Widodo in Jakarta, Indonesia on April 17, 2024 (Achmad Ibrahim / AP)

Despite his offer, the Ministry of Industry appeared unmoved.

“According to the government's point of view, we want this money to be bigger,” the spokesman Febri Hendri Antoni Arif said at the time.

On November 25, Jakarta rejected the project, and Industry Minister Agus Gumiwang Kartasasmita said it was not in line with Indonesia's “just principles”.

He also said that Apple has invested heavily in neighboring countries such as Thailand and Vietnam, including $15bn in developing the latter.

“Based on the technical analysis, the savings did not meet our criteria,” he said.

“We want Apple to come back to do business here, but we need the right decision.”

Meanwhile, Apple fans like Winston are faced with the prospect of making do without the latest models for the future.

“I understand that the ban is for political reasons because Apple does not want to invest in Indonesia, and I stand with my government. But I will never buy an iPhone abroad,” he said.



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