Q1. Could you start by giving us a brief overview of your professional background, particularly focusing on your expertise in the industry?

I have been involved in IT and Telco market research, telco product management, including enterprise and consumer segments, and smartphone sales and solutions in both B2B and consumer markets for quite some time. I have a career in one of the leading market research agencies, the second-largest telco company in Indonesia, and the biggest Korean smartphone manufacturer.

So, I have a deep understanding of the smartphone market and its relationship with telcos. At the same time, I understand how to analyze relevant market data to create telco products that are in line with consumer desires while increasing the market share of smartphone users.

Q2. What are the major cost drivers in smartphone packages, and how are they managed?

In creating a telco product package for smartphones, several cost components must be considered.

First, of course, the network cost in relation to the size of the package we will create. We may already be able to see this network cost as a fixed cost, so we have to calculate the projection of how many users will use the network and how much data will be used. This applies if the network cost depends on the size of its use. Several telco companies apply this scheme.

Second, partnership costs. It is very common for telcos and smartphone manufacturers to include partner solutions or applications in packages. It is currently quite common for high-end users to embed AI (artificial intelligence)- based applications. From both sides, there is usually an economic scheme for the revenue generated, which needs to be considered when creating a package.

Third, marketing costs. Whether it is for a newly launched product or one that is already on the market, costs related to advertising promotions and channel commissions will always arise. This is to boost sales or encourage the market to use our package.

Q3. What methods do you use for demand forecasting?

The simplest way is to look at historical trends and then project them into the next few years. You can use the moving average method, for example, applied to a period that is believed to be quite valid.

Challenge: The data used should be sales data for a quite similar package to the one we developed. So, it is necessary to periodically adjust to see the actual market trend.

The next way is to conduct a demand and supply analysis. Smartphone supply data, smartphone user data and network coverage are processed, then simulations and modeling are carried out by including other related industry factors such as the development of OTT players and economic components, to obtain projection figures. We can enter growth targets using the CAGR (Compounded Annual Growth Rate) method.

Q4. Who are the main players in the smartphone package industry, and what market share or position does each represent?

Recorded smartphone users (Q1 2024 data) are around 230 million. There are currently four telco companies in Indonesia. The largest is a subsidiary of a state-owned enterprise, with a market share of around 50%. In second place is a telco company whose shares are mostly owned by a consortium from the Middle East, with a portion of around 26%. Then, the Southeast Asian consortium group has a portion of around 16%. Finally, there is a local private consortium company with a portion of around 8%.

Q5. What is the go-to-market strategy for the industry?

First, determine the communication that suits the target market, either through ATL (above the line) or BTL (below the line) so that the message delivered is effectively received.

Second, use a sales channel that is accustomed to selling similar packages. We usually call this a non-traditional channel. This also includes smartphone sales outlets.

Third, prepare an attractive and competitive incentive scheme.

Of the three strategies, it would be very good if each component was carried out at a completely different point from competitors.

Q6. What are the best growth opportunities in the smart phone package market, and why?

If you look at the number of users, of course, the majority are in the low-end segment, but they usually do not produce great value because of their small usage.

What needs to be focused on is mid-end smartphone users because, in general, users of this segment will maximize device usage. Psychologically, users of this segment are very enthusiastic about exploring new applications, which will ultimately maximize the potential revenue for the company.

Q7. If you were an investor looking at companies within the space, what critical question would you pose to their senior management?

If you really want to manage the smartphone user market, you need to prepare for how far the company dares to invest in managing its ecosystem end-to-end.

Starting from network capacity, partnership with mobile smartphone brands, mutually beneficial content, promotions, and excellent customer experience, smartphone users, in addition to actively exploring competitive offers, network stability, and content that supports activities, also demand reliable customer touchpoints.