Indonesia should develop broader AI ecosystem to enable infrastructure ecosystem competitiveness — Kearney Indonesia’s Ivon Yeap

He also notes that the country should develop its broader AI ecosystem so that infrastructure investment is supported by growing local demand.

Indonesia’s technology industry continues to expand as one of Southeast Asia’s largest digital markets, anchored by fintech adoption, e-commerce activities, and investment in digital infrastructure. Strong government digitalisation initiatives fuel this momentum, with the country’s growing digital economy creating opportunities across sectors and positioning it as a regional powerhouse.

These developments make industry perspectives on network strategies and digital infrastructure particularly relevant. With extensive experience advising telecommunications, technology, and digital infrastructure companies across the Asia Pacific, Kearney Indonesia Principal Ivon Yeap brings valuable insight into Indonesia’s evolving technology landscape.

As a member of its Communications, Media, and Technology Practice, he specialises in areas including mergers and acquisitions, wholesale strategy, and network strategy, with a particular focus on Indonesia, Malaysia, and Australia.

As one of the esteemed judges at the Indonesia Technology Excellence Awards 2026, Yeap uncovers how Indonesia’s technology landscape has evolved, looking into investment considerations that are shaping its growth, factors that can strengthen its competitiveness, and how it can establish a stronger position as a regional digital hub.

Throughout your work in telecommunications, technology, and digital infrastructure,  what have been the most significant shifts you've observed in Indonesia over the years?

I have seen Indonesia move from a market centred largely on voice and mobile coverage to a much broader ecosystem built around data, cloud and increasingly AI. I have also observed a gradual shift away from vertically integrated, operator-owned networks towards shared and neutral-host models, as the industry recognises that utilisation matters as much as asset ownership. Demand has expanded beyond consumers to enterprises, government services and critical sectors such as finance, healthcare, logistics and energy. The central challenge has extended from coverage to improving quality, affordability, resilience and meaningful adoption across the archipelago. The July 2026 allocation of 700 MHz and 2.6 GHz spectrum, together with the government’s 2025–2029 plan, focus on inclusive connectivity, digital growth and trust,  suggests that this transition is accelerating.

From a consulting perspective, what are the biggest challenges clients face when scaling digital infrastructure investments in Indonesia?

From a consulting perspective, the biggest challenge is that Indonesia combines extraordinary demand potential with difficult project economics, particularly outside the largest urban centres.  Its archipelagic geography raises deployment and maintenance costs, whilst demand density and customers’ ability to pay vary sharply by location. Clients also face fragmented rights-of-way, local permitting and land access, which can delay otherwise viable fibre, tower and data centre investments. Data-centre investors must additionally secure reliable power, renewable energy options, water, connectivity and regulatory clarity at the same time. Scaling successfully therefore requires a disciplined project-by-project investment assessment, anchor demand, phased capital deployment and operating models that embrace shared, rather than dedicated assets.  

What factors will be most important for Indonesia to strengthen its competitiveness and attract long-term investment in AI, data centres, and technology infrastructure?

Indonesia has a compelling combination of market scale, digital native population and future growth potential, but long-term investment will increasingly depend on the quality and competitiveness of the underlying infrastructure ecosystem. The availability of reliable, scalable and cost-competitive power, particularly renewable energy, will be critical as AI and high-density data centres place significantly greater demands on electricity networks. Investors will also look for strong international and domestic connectivity, suitable land and infrastructure, access to skilled technical talent, and a stable, investor-friendly regulatory environment. Indonesia should also develop its broader AI ecosystem—including cloud platforms, AI-enabled applications and 
services and industry adoption—so that infrastructure investment is supported by growing local demand rather than capacity alone. Ultimately, Indonesia’s competitiveness will be determined not by any single incentive, but by how effectively it brings together power, connectivity, talent,  demand and execution at scale.

What opportunities do you see for public-private collaboration in accelerating  Indonesia's digital transformation?

Indonesia already has valuable public-private precedents in Palapa Ring and SATRIA-1, and the next opportunity is to apply those lessons more broadly. Collaboration is particularly powerful where the social value of connectivity is high but standalone commercial returns are insufficient. International examples such as Malaysia’s JENDELA programme and the United States’ Broadband Equity, Access and Deployment (BEAD) programme demonstrate how government funding and defined coverage objectives can mobilise private-sector investment to close the digital divide. Government can provide the enabling framework and targeted financial support, whereas private operators bring capital, technology, operating expertise and innovation to determine the most efficient solution. Done well, public-private collaboration can turn universal connectivity from a social obligation into a sustainable infrastructure programme that expands economic participation across Indonesia.

How can Indonesia strengthen its position as a regional digital hub amidst growing competition from other Southeast Asian markets?

Indonesia can strengthen its regional position by thinking beyond national boundaries and deliberately capturing the opportunity created by the Singapore–Johor–Riau Islands (SIJORI)  corridor. Rather than viewing Singapore and Johor purely as competitors, Indonesia should position Batam as a complementary and integral node in a cross-border digital ecosystem spanning data centres, subsea connectivity, cloud infrastructure and AI compute. The new direct connectivity between Batam and Singapore is an important catalyst, allowing Indonesia to attract workloads and investment that increasingly operate across the SIJORI corridor. Indonesia should also focus on capturing more of the value chain around these investments, including network interconnection, cloud and AI services, engineering capabilities, digital talent and supporting technology industries. This will require coordinated infrastructure planning, scalable and competitive power, continued investment in international connectivity, and an investment environment that enables projects to scale quickly.  

As one of the judges at the Indonesia Technology Excellence Awards 2026, what innovations are you most excited to see from this year's nominees?

As a judge, I am particularly interested in seeing nominees move AI beyond experimentation and demonstrate tangible business returns from its deployment. AI adoption is becoming widespread, but the more important question is whether it translates into measurable improvements in revenue, margins, productivity, customer experience or capital efficiency. I  would like to see organisations not only demonstrate what their AI solutions can do but also quantify what has genuinely changed in the business as a result. An emerging concept from my Kearney colleague I find particularly relevant is EBITTDA — Earnings Before Interest, Taxes, Token costs, Depreciation and Amortisation — which recognises that as AI scales, token consumption itself becomes a cost that needs to be actively managed against the value generated. The strongest nominees, in my view, will be those that can show they have redesigned processes around AI, rather than simply adding AI to existing ways of working, whilst maintaining the right governance and human judgement. Ultimately, I am excited to see Indonesian companies demonstrate that AI can move from impressive pilots and use cases to sustainable, scalable and financially meaningful impact.