Facebook launches as a management consulting firm in Indonesia

18 January 2018 Consultancy.asia 3 min. read

The global internet and social-networking giant Facebook looks set to launch a management consulting operation in Indonesia, according, at least, to papers filed by the company in its move to establish a permanent office in the country.

Three years on from opening its first representative office in Indonesia, Facebook, the unstoppable international force for friendship, has cut the ribbon on a permanent base in Jakarta. The inauguration comes after confirmation from Facebook’s Indonesia country director Sri Widowati that the company had secured a full operating permit from the government last year. Local reports, however, note that the licence pertains to a management consulting entity.

Questions remain as to whether the all-conquering internet behemoth does in fact plan to operate as a consulting firm in the Southeast Asian nation, or, should it emerge as a case of fake news, whether such a licence is appropriate considering the firm’s primary source of revenue is in advertising, naturally, as one of globe’s primary vacuums for the advertising dollar. Widowati was quoted as saying nothing specific on the matter;

“Our investment in Indonesia is a priority. This is a big market for us. Our users are very active here. We welcome every good opportunity to invest. But we cannot say specifically which type of business we are running in Indonesia,” she said, adding, “As a company, we respect the regulations of every country [in which Facebook operates].”Facebook launches as a management consulting firm in IndonesiaPreviously, the Indonesian Communications and Information Ministry director general of information applications, Samuel Abrijani Pangerapan, after a meeting with Facebook representatives last year, had said that the Facebook office would be opened in the country as a permanent business entity as per certain preconditions.

The conditions outlined were, namely, that the company will establish specific business activities as required by existing regulations, and that they would keep a check on smut. “In other countries, they have several levels of pornographic content, but in Indonesia all pornographic content is prohibited,” the director general said.

Elsewhere, it has been reported that regulations concerning foreign internet companies – such as the requirements for permanent licenses and a stipulation that certain user data must be stored on local servers – are still in the draft stage, and the reason as such why Facebook has been uninclined to comment. In turn, the permanent license will come with greater local tax obligations, which may explain the equal reluctance on behalf of Indonesian authorities to discuss its finer, less significant details, such as what it says on the can.

Indonesia represents an important growth market for the internet giant, and the world’s multinationals at large. The nation currently clocks in as Facebook’s fourth-largest user-base with 126 million users, up 40% from last year and now behind just India, the U.S. and Brazil, with a reported 65 million users logging in daily. Jakarta, meanwhile, is the number one city in the world for Instagram stories, beating out the likes of Los Angeles and New York.

And while perhaps slightly somewhat dwarfed by the likes of Facebook, Indonesia's local start-up scene has been heating up in recent times, with the countries own e-commerce sector leading the way.