Netflix Collaborates with Telkom to Reach More Users in Indonesia

Almost two years after the unblocking, Telkom finally announced its cooperation with the platform streaming Netflix. This collaboration presents a package bundling on IndiHome services and Telkomsel, both for new customers and Existing.

"Collaboration with Netflix become one of IndiHome's concepts in realizing window of entertainment for customers. Ease of making payments is also our priority in this collaboration," said Director of Consumer Service Telkom Venusiana in an official statement.

marketing director Telkomsel Derrick Heng also added, this collaboration can strengthen the position Telkomsel as 'The Home of Entertainment' to open access to various digital entertainment platforms and improve the quality of customers' digital lifestyle.

"We prioritize service-based customer-centric which is supported by the availability of digital connectivity with leading-edge broadband technology that is evenly distributed and has quality throughout the country," said Derrick.

For IndiHome users, the package bundling with Netflix can be enjoyed as a service add-on. For activities, customers Existing just click on the link that Netflix sends to the registered email in the myIndiHome application or other channels.

For users Telkomsel, Prepaid and customers Telkomsel Halo can subscribe every month without the need to use a credit card. Telkomsel provides a data quota bundling package variant and a Netflix subscription for 1 month starting from IDR 62 thousand with payment via credit.

When compared to existing packages, the bundling the newest is a little more expensive. For the record, the subscription package for smartphone around Rp. 54 thousand per month. However, this service can only be accessed via one device.

Meanwhile, package bundling This latest version includes access to various devices such as TVs, laptops, smartphone and tablets. The subscription fee will also be included in one monthly bill. Both offer added value depending on the needs of the customer. 

Access blocking

This collaboration seems to have been long awaited by many post-conflict Telkom users blocking access a few years ago. Moreover, Telkom (IndiHome and Telkomsel) controls more than 50 percent of the telecommunications market share in Indonesia.

A little flashback, Telkom first blocked access to Netflix on January 27, 2016. Starting at 00.00 WIB at that time, all Telkom internet connections could not access Netflix. This blocking also applies to all users, starting from IndiHome, WiFi.id, and Telkomsel.

At that time, Telkom's excuse was to block Netflix because the platform did not meet regulations in Indonesia. In addition, this blocking is called because there is various pornographic content on the platform. Then almost 4,5 years later, Telkom gave up and unlock Netflix to all users on July 7, 2020.

Interestingly, before this collaboration was announced, Telkomsel already worked with Disney+ to deliver service packs. According to Media Partners Asia survey (MPA), Disney+ can penetrate faster because it cooperates with local cellular operators. In fact, Disney+ only entered Indonesia as of September 2020.

MPA reports that the number of Disney+ users in Indonesia has reached 2,5 million, while Netflix, which has been broadcasting in the country since 2016, has only pocketed 850 thousand as of January 2021. Netflix is ​​still inferior to the platform. on-demand Viu which has 1,5 million users in that period.

It can be said that collaboration with cellular operators is a key strategy to facilitate access to service payment models with credit options. Digital wallets can also be a payment option, but not all people use them, apart from awarenesswhich continues to grow. Cellular customers in Indonesia still depend on top-up credit.

From the operator's point of view, collaborating with streaming platforms can potentially increase subscribers' ARPU. Operators can increase their added value as network providers.

Collaboration between Telkomsel and Disney+ are also considered strategic because they provide access to Disney+ services for free on data packages. In our observation, the XL Axiata operator also provides free access (a kind of add-on) Netflix service on some data plans.

Platform competition on-demand

These ways can help increase the number of customers--though not organically--to win the competition in the market streaming and on-demand Indonesia.

Unlike Netflix, which does not use an advertising scheme, the platform streaming owned by EMTEK, Vidio uses a premium broadcast and advertising scheme. Different from platform on-demand In a similar vein, Vidio strengthens its position by entering sports content that is considered to have significant fans in Indonesia. Currently video has 62 million users, of which 2,3 million are paid subscribers.

In the context of preferences, survey The Trade and Kantar reported that Korean dramas are the most favorite content for 74 percent of female OTT viewers in Indonesia. Meanwhile, as many as 61 percent of male viewers choose sports-related content.

The total Indonesian audience on the OTT platform has reached 83 million with a total of 3,5 billion hours of viewing per month or an average of 41,4 hours per month per viewer.