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NEWS UPDATES Asean Affairs                               8  September 2011

Indonesia loses RIM data center to Malaysia

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As officials voiced disappointment over Research In Motion’s decision to build a BlackBerry manufacturing plant in Malaysia, analysts and business executives blamed the government for failing to convince the under-fire company to build a data center in Indonesia.

Top government officials such as Gita Wirjawan, the chief of the Investment Coordinating Board (BKPM), and Industry Minister M.S. Hidayat reacted with dismay over RIM’s plan to build a factory in Malaysia, home to nearly 30 million people, instead of Indonesia, a country with about 240 million.

Gita said one of the Canadian company’s considerations in not building the factory here was a dispute over its data center. Tifatul Sembiring, the communication and information technology minister, announced last year that RIM was required to set up a data facility in Indonesia.

It was also required by the government to establish at least 40 customer care centers in the country and facilitate lawful interception of its encrypted BlackBerry Messenger service by government officials.

“It is true that Indonesia has a bigger potential market [than Malaysia], but what investors need is legal certainty,” said Iwan Rachmat, an information technology consultant at research firm Frost & Sullivan.

He said the government’s strict requirements would prompt companies to reconsider plans to expand their operations in Indonesia at a time when the government was courting investment.

Iwan said the government should not just encourage RIM to set up a local data center but also provide financial incentives.

He also said the RIM decision could “pressure” the government to improve the regulatory environment for global investors.

In January, RIM fulfilled a requirement for content filtering — including blocking pornographic sites — on its handsets.

Heru Nugroho, an IT expert and former secretary general of the Indonesian Internet Service Provider Association (APJII), said the government’s main interest was having the power to intercept messages, allowing it to monitor criminal activity.

He said having a data center established in Indonesia was also a political issue and a matter of national pride. Countries including India and Pakistan have also made similar requests of RIM.

Aulia Ersyah Marinto, corporate secretary for Telkomsel, the nation’s biggest mobile-phone operator, said the decision on the location of the factory was not related to the local data center.

It was still possible the regional aggregator network would be located in Indonesia, he said.

“The government has failed to convince [RIM] to build a factory here,” Aulia said. “The government should be capable of making approaches [to investors] by providing facilities that comply with international standards.”

RIM said on Aug. 22 that the company was “on track” to address all the topics it had discussed with Tifatul’s ministry.

Government and RIM officials will meet on September 17 to discuss the demands.

Ridwan Efendi, a committee member of the Indonesian Telecommunications Regulatory Body (BRTI), said it would be more cost-efficient for the Canadian company to build a local data server in Indonesia, its second-biggest market.


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This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

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