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According to Daniel Tumiwa, the Chairman of the Ecommerce Association of Indonesia (IDEA), Amazon is coming to Indonesia with $600 million US (Kompas).

Tumiwa did not know exactly when Amazon would begin operations in Indonesia but said that the company’s first rumored entry into the region would probably follow the same pattern in other large countries.

The pattern, like in India, consists of one year of testing the waters followed by a decision on whether to stay in the game or not.

The IDEA chairman mentioned that Amazon was able to take over 50% of the Indian ecommerce market within one year, despite well-established local competitors like Flipkart. However, he also noted that they bowed out of China after one year, conceding the market to Alibaba. There are no ecommerce companies in Indonesia with the same kind of dominance that Alibaba has in China, which is why it would make sense for Amazon to enter the Indonesian market now.

Indonesia’s rapidly growing middle class, which is slowly becoming more comfortable with online shopping, makes the market potential huge. With an estimated worth of around $300 billion US, Amazon can burn through plenty of money to find solutions to Indonesia’s ecommerce problems.

A version of this appeared in Coconuts Jakarta  and Deal Street Asia on June 20. To read the full story, click here and here.

The Future of Telcos in Southeast Asia

Source: e27

The future of telcos in Southeast Asia will be impacted by a strong de-concentration process says the experts on stage at Echelon Asia 2016. Ecommerce ventures can reap most of the benefits from this process as long as they are able to leverage new technologies to build innovative telco solutions for the region.

It is way more than launching an app. It is about network effect.

Mittman, Co-founder and Vice President of MyRepublic, went on to explain that the mega trend of the next 10-20 years will be the de-concentration of the telecom industry that has long been one of the most concentrated in the world.

Which is why, according to Karianne Melleby, Vice President and Head Of Digital Partnerships at Telenor, the next step is about forming partnerships, which requires education.

“Our vision is built on the need of the telco to disappear, but in a way that provides services. When you digitalise everything like, for example, ordering food online, it needs to be completely smooth.”

Gupta said that it means leveraging new technologies, like Cloud computing and payment platforms, because entrepreneurs need somebody to meld them together — which is where the telcos can step in.

In order to launch the telco company of the future, three things are required:

  • Regulation
  • Smartphone penetration
  • Demographics

The two latter are already strongly shaping the future of telcos in Southeast Asia. What is lacking is proper regulation, complexity of the market such as different countries and the legal system makes the process slower but recent projects launched by authorities show very encouraging signs.

A version of this appeared in e27 on June 15. Read the full article here

Ensogo halts share trading

Source: ensogo.co.th/

Ensogo, the struggling daily deals ecommerce company, saw today its trading suspended on the Australian Securities Exchange (ASX) pending an announcement.

Formerly known as iBuy and founded by entrepreneur Patrick Grove, Ensogo owns a network of ecommerce websites in Hong Kong, Singapore, Malaysia, the Philippines, Indonesia, and Thailand. The company has been experiencing a decline in share price down to nearly zero this year.

The trading halt follows the resignation of two Ensogo directors (Thomas Baum and Frederique Covington) as well as the selloff by a big shareholder. On May 24, The Australian reported that Macquarie offloaded 2.3 million shares in Ensogo for A$0.50 apiece, marking a 50 percent discount to its closing price at the time.

Ensogo has been embroiled in controversy after its merchants complained about delayed payments starting in April this year.

The Australian bourse said the suspension would remain in place until the opening of trade on Tuesday, June 21 or when the announcement is released to the market. The news comes less than a year Groupon shuts down in 7 countries including Thailand and Philippines in Southeast Asia, signalling the start of ‘deal fatigue’ among consumers that lowers re-purchase rates and thus customer lifetime value.

A version of this appeared in Tech in Asia on June 17. Read the full article here.

Southeast Asia Startup Funding

Golden Gate Ventures has raised a $60 million fund from investors including Temasek Holdings Pte and Facebook co-founder Eduardo Saverin as it seeks to sustain its pace of investment in Southeast Asia’s startups.

Golden Gate Ventures is one of the earliest VC firms to target the region. Its $10 million debut fund fueled investments in 30 startups across seven countries, including flea market app Carousell and online grocer Redmart.

“We were one of the earliest funds and we rode the wave that took over the region,” said Lauria, Golden Gate’s managing partner. The second fund was oversubscribed by $10 million, according to the company. “The ecosystem is now significantly bigger and there are a lot more deals. We want to double down on the opportunity.”

Southeast Asia, home to some of the world’s fastest growing economies, is approaching a tipping point, according to a recent report by Google Inc. and Temasek.

The region’s internet economy is predicted to grow six-fold to US$ 200 billion in the next decade and has attracted US$ 1.7 billion in investment capital this year alone. With this new development, Southeast Asia’s startups remain one of the hottest sectors to both regional and global venture capital funds.

A version of this appeared in Bloomberg on June 14. To read the full article, click here.

OnePlus Quits Indonesia

Source: Google Images

OnePlus blames Indonesia’s complex and strict regulations on imported smartphones for its decision. Last year, the government passed a law that requires imported 4G phones to contain 30 percent locally sourced components. OnePlus failed to complete the mandatory certification process on time and the investments needed to comply with the new regulation, set to take effect in January 2017, is too overwhelming for the relatively new brand.

“Chinese phone maker OnePlus is halting its operations in Indonesia. That means the company’s upcoming flagship phone, the OnePlus 3, will not be sold in the archipelago through official channels”

The regulation would require OnePlus to build a new fulfillment center or join a local factory, something beyond the company’s current capability. OnePlus will be missing an enormous opportunity to reach the 326M Indonesians on mobile where foreign companies such as Samsung and Asus are performing well.

Indonesia mobile

The new regulations set by the Indonesian government as an attempt to give room for local players may decrease success found by smaller foreign brands. It also highlights the complexities of doing ecommerce in Indonesia as ever-changing government regulations is often seen as a bottleneck to business growth.

Read the full article on Tech in Asia here.

Innovation and Disruption: Industry experts weigh in on what it means

For those working in ecommerce, or are followers of tech related news, seemingly abstract buzzwords such as ‘innovation’ and ‘disruption’ often come up in research articles or in speeches. This article weighs in on what ‘innovation’ really means in relation to retail. Although peppered with US retail references, a lot of the content can be transferred to the Southeast Asian retail commerce landscape as well.  Read more