Indonesia Data Storage Market Outlook to 2030

Indonesia Data Storage Market Overview

• The Indonesia Data Storage Market size was valued at USD 0.26 billion in 2018 and has increased to USD 0.37 billion in 2023. The rapid expansion of the digital economy in Indonesia, coupled with the increasing adoption of cloud computing, big data analytics, and the proliferation of Internet of Things (IoT) devices, has fueled the demand for data storage solutions in the country.
• The key players in the Indonesia Data Storage market include Dell Technologies, Hewlett Packard Enterprise (HPE), IBM, and local players like PT Data Sinergitama Jaya and PT Sigma Cipta Caraka (Telkomsigma). These companies offer a wide range of data storage solutions, including traditional storage systems, cloud storage, and data management software, catering to the diverse needs of businesses and government agencies in Indonesia.
• In 2023, Dell Technologies announced the expansion of its data center in Jakarta, aiming to enhance its cloud storage offerings in the Indonesian market. The expansion is part of Dell's strategy to cater to the growing demand for cloud-based data storage solutions in Southeast Asia, particularly in Indonesia.
• The Java region, particularly Jakarta, dominated the Indonesia Data Storage Market in 2023. Jakarta's dominance can be attributed to its status as the economic and business hub of Indonesia, with a high concentration of data centers, IT companies, and financial institutions.

Indonesia Data Storage Market Segmentation

The Indonesia Data Storage is segmented into Storage Type, end-user industry, and region.

• By Storage Type: The market is segmented by storage type into cloud storage, on-premises storage, and hybrid storage. Cloud storage holds the dominant market share in 2023. This dominance is driven by the increasing adoption of cloud-based solutions by businesses looking for scalable and cost-effective storage options.

• By End-User Industry: The market is also segmented by end-user industry into banking and financial services, healthcare, and retail. The banking and financial services segment holds the largest market share in 2023, driven by the increasing volume of data generated by financial transactions and the need for secure storage solutions to comply with regulatory requirements.

• By Region: The Indonesia Data Storage Market is segmented by region into North, South, East, and West. The western region dominated the market in 2023. The region's dominance is due to its well-developed infrastructure and access to high-speed internet makes it an attractive location for data storage providers.

Indonesia Data Storage Market Competitive Landscape

• PT Sigma Cipta Caraka and Microsoft Azure: In 2023, PT Sigma Cipta Caraka (Telkomsigma) entered into a strategic partnership with Microsoft Azure to offer cloud storage services to businesses in Indonesia. This partnership aims to leverage Microsoft Azure's global cloud infrastructure and Telkomsigma's local expertise to provide scalable and secure data storage solutions. The collaboration is expected to drive the adoption of cloud storage in Indonesia, particularly among SMEs and government agencies looking for reliable and cost-effective storage options.
• PT Data Sinergitama Jaya Tbk: In 2023, PT Data Sinergitama Jaya Tbk (Elitery) was named a Google Cloud managed services provider in Indonesia, aiming to enhance cloud services for businesses. Elitery also partnered with the Association of Indonesia Municipalities to provide generative AI solutions for city governments. The company was listed on the Indonesia Stock Exchange in January 2023.

Indonesia Data Storage Market Analysis

Indonesia Data Storage Market Growth Drivers:

• Expansion of Cloud Services: The adoption of cloud services in Indonesia has seen a substantial increase, with the number of businesses utilizing cloud storage solutions expected to surpass 50,000 by the end of 2024. This shift is driven by the need for scalable, cost-effective, and flexible storage solutions that can accommodate the growing data storage requirements of companies across various industries.
• Expansion of the Financial Services Sector: The increasing utilization of data centers in the financial industry to ensure secure and efficient financial operations is contributing to market growth. The Financial Services Authority (OJK) has issued a Code of Ethics for Responsible and Trustworthy AI in the Financial Technology Industry, which is expected to drive the adoption of data center storage solutions.
• Rising Demand for Cloud Computing and Big Data Analytics: The increasing adoption of cloud computing services and big data analytics solutions is driving the demand for data center storage in Indonesia. The number of cloud computing subscribers in Indonesia reached 27.8 million in 2023, up from 22.4 million in 2020.

Indonesia Data Storage Market Challenges:

• Lack of Skilled IT Professionals: In 2024, the country is projected to face a shortage of over 600,000 skilled IT professionals, particularly in data management and cybersecurity, due to rapid digital transformation and increased demand for advanced data solutions. This skills gap is a major hurdle for businesses looking to implement and optimize data storage solutions, leading to potential inefficiencies and increased operational costs.
• High Operational Cost: The operational costs associated with maintaining data centers in Indonesia are projected to rise due to increasing electricity prices and real estate costs. In 2024, the average electricity cost is expected to be around USD 0.12 per kWh, which could lead to an estimated increase of USD 50 million in annual operational expenses for data center operators. This financial burden may hinder smaller companies from investing in necessary data storage infrastructure.

Indonesia Data Storage Government Initiatives:

• Investment in Digital Infrastructure: The Indonesian government has allocated USD 1.5 billion for the development of digital infrastructure under the National Digital Strategy. This initiative aims to enhance data center capabilities and improve connectivity across the country, which is expected to increase the demand for data storage solutions over the next five years.
• Support for Local Data Center Development: The government is promoting the establishment of local data centers through tax incentives and subsidies. In 2024, these incentives are projected to attract investments of around USD 500 million from domestic and international players, fostering growth in the data storage market.

Indonesia Data Storage Future Market Outlook

The Indonesia Data Storage market is expected to grow by USD 0.51 billion in 2028. The market is also likely to shift towards more organized with established players and online platforms expanding their reach.

Indonesia Data Storage Future Market Trends:

• Increased Adoption of Edge Computing: Over the next five years, the adoption of edge computing solutions is expected to increase in Indonesia, driven by the growing demand for real-time data processing and storage. By 2028, it is projected that over 20,000 businesses in Indonesia will have implemented edge computing solutions, particularly in industries such as manufacturing, healthcare, and retail.
• Integration of Artificial Intelligence in Data Management: The integration of artificial intelligence (AI) into data management and storage solutions is expected to become a major trend in the Indonesia Data Storage Market. By 2028, it is estimated that the majority of large enterprises in Indonesia will use AI-powered data management tools to optimize their storage systems, reduce costs, and enhance data security.