Google-Temasek Research: Indonesia Dominates Internet Economic Market Share in Southeast Asia

The Southeast Asia (SEA) region is predicted to be the region with the fastest internet economic growth. In the past decade, the dynamics of digital business in various landscapes have been quite pronounced -- in the form of the emergence of new businesses or the strengthening of existing businesses in massive investments. To view the current conditions, Google and Temasek re-released a research report titled e-Conomy SEA 2018.

e-Conomy includes economic activities supported by the internet and digital approaches. Some of the sectors studied include online travel, online media, ride hailing and E-commerce; because it is considered to have reached a mature stage in the SEA region. Meanwhile, researchers think that other sectors such as education, finance, health and social services are still in their early stages. This research covers Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

In SEA, the internet economy is predicted to reach $240 billion by 2025, this year it has reached $72 billion. To support growth, businesses will need investments of up to $50 billion. Currently, research also estimates that internet consumers in the SEA region have reached more than 350 million people. On average they are connected with approach mobile devices, through their smartphone devices.

Indonesia is the country with the fastest and largest growth

In the sector studied, the largest market is dominated by business online travel. However, in 2025, E-commerce will be the biggest. Business value online travel 2018 reached $30 billion, E-commerce at $23 billion. Despite Grab and Go-Jek showing a big investment round this year, their market size is still at $8 billion, even below online media which is valued at $11 billion.

Indonesia is the fastest growing country and the largest market size in SEA. In 2018 the figure reached $27 billion, will contribute $100 billion in 2025. The growth of the digital economy in Indonesia is very fast, because in 2015 the figure only reached $8 billion, meaning that this year it has grown more than 4x. For this year, Thailand is the second largest at $12 billion.

A closer look at each sector

Sector E-commerce become the most dynamic in the last three years. This dynamic is due to the massive adaptation process among consumers. This year's sector E-commerce managed to contribute the value of the business round reached $ 23 billion, predicted to reach $2025 billion in 100. Para unicorn In SEA such as Lazada, Shopee, and Tokopedia, Google and Temasek are considered to play a critical role in growing this business.

In sector E-commerce, Indonesia remains the market leader with business value reaching $12 billion in 2018. While other countries such as Thailand and Vietnam have only reached around $3 billion this year.

online travel so that biggest this year. The research states that this landscape includes three main sub-sectors, namely online vacation rentals, online hotels, and online flights. The airline ticket sales business still dominates this year with revenues reaching $18,4 billion, followed by hotel reservations at $10,7 billion and vehicle rentals at $0,6 billion. The total value of nearly $30 billion will reach $78 billion in 2015, with the portion of air ticket sales dominating $40 billion.

No different from E-commerce, in sector online travel Indonesia also holds the largest market share value. This year Indonesia contributed $8,6 billion, will reach $25 billion by 2025. Indonesia also leads the market share in this sector. This year's figure is $2,7 billion, it is projected to triple by 3 to reach $2025 billion.

Next up is the sector online media, which are divided into three types of services, including music and video subscriptions, online gaming, and online advertising. This year the figure reached $11,4 billion, dominated by the $7,2 billion online advertising sub-sector. Temporary online gaming donated $3,8 billion this year, and music/video services on-demand $0,4 billion. By 2025, it is predicted that this sector will contribute $32 billion in SEA, with the percentage of sub-sectors not much different from this year's conditions.

The last sector researched by Google and Temasek is ride hailing. It consists of two sub-sectors, namely online food delivery and online transport. In 2018 the figure reached $7,7 billion, with a share of $5,7 billion from online transportation and $2,0 billion from online food delivery. By 2025 the figure is predicted to be $28 billion, with the online travel sub-sector leadership reaching $20 billion.

Indonesia remains the largest market share with this year's value reaching $3,7 billion. It is projected that in 2025 it will touch $14 billion. Also highlighted are the key players in SEA for this sector, namely Grab and Go-Jek. In addition to transportation and food delivery services, both of them continue to develop digital payment solutions in developing their business.