JAKARTA– You’ve probably heard about the swell of Internet users coming from Indonesia. It’s already the second largest market for Facebook, after the United States. It’s “only” the fifth largest market for Twitter, but it’s number one in terms of the ratio of people online to Twitter adoption. And Google trends ranks Indonesia as the top Foursquare country— two slots above the United States.
Six months ago all of this was newsy and surprising. Since then, Indonesia’s love affair with social media has only been growing. But as love affairs go, it’s a staggeringly unrequited one.
I’m attending the SparkxUp awards in Jakarta yesterday and today, a first-time, flying-by-the-seat-of-their-pants startup competition that was besieged with more than 400 entrepreneur applicants. Google, Yahoo and Microsoft are all sponsoring, and TechCrunch is a media sponsor. Executives from Yahoo and Google both did keynotes. Zynga is here too to meet the Indonesian consumer face-to-face and try to figure this out-of-nowhere Web force out. We toured some smokey Internet cafes late last night together, where I snapped the above photo.
But Facebook, Twitter, and FourSquare– the companies that may be gaining the most love and traffic from Indonesia– are nowhere to be found, and according to locals, their executives haven’t made a single official appearance on the ground….ever. Maybe they came here and just didn’t call anyone, but I’ve asked the question in dozens of individual meetings at a 100-person event earlier in the week. No one has reported seeing as much as a business card from any of these companies. If they’ve come to check out Indonesia, they did it without talking to anyone in Jakarta’s Web scene.
Oh, wait. There was that one time an executive from Facebook was scheduled to do a keynote. The entire Web scene was in a fever pitch to attend. And then he cancelled at the last minute– reportedly to go to Brazil instead. He hasn’t rescheduled. In fact, this morning I met with Izak Jenie, the director of content strategy for Nexian, the number two handset company in Indonesia. They sell about five million handsets a year; most of them are scaled-down, full-keyboard smartphones that sell for between $60-$80– a steal compared to the $400 Blackberry. He says he recently met with Google about putting a search box on every phone, but Facebook? Well, Facebook won’t even return his calls and emails.
Wow. Really?
Ok, let me get this straight. These three companies taken together have raised just over $1 billion in venture capital and have more than a thousand employees, and not one of them can be bothered to make a single fact-finding, goodwill trip to what’s arguably their hottest, fasting growing market in the world? Not even send an intern flying coach? Meanwhile Zynga is here now, Google is opening local operations in the first quarter, and Yahoo is a regular in the start-up scene, already completing one acquisition.
It’s shaping up to be the Valley and China in the Web 1.0 days all over again: The implicit arrogant assumption on the Valley’s part that either these people will just keep using our products because they can’t build competitive ones on their own, or we can’t profit of them so we just don’t care.
Wake up, guys. Emerging markets aren’t just about offense anymore, they’re about defense. This isn’t the age of eBay, Yahoo, and Amazon when you could expand in the US first, and worry about the rest later, nor is this an age of Friendster where a big Southeast Asian Web presence is worth little more than a sandwich. As Fred Wilson (you know, a Twitter, Foursquare and Zynga investor…) recently said to GigaOm, “If you look at Facebook, Twitter, Google– 75% to 80% of their users are outside the US, so globalization of Web services at scale is something I’m really interested in…So globalization is probably the number one thing I’ve been thinking about.” Understanding your users isn’t a nice-to-have luxury; it’s a must-have or someone will beat you.
Let me give you a primer on the Indonesian user: Half of Indonesia’s 240 million person population is under the age of 29. They are Web obsessed, and unlike the rest of Southeast Asia they have a huge domestic market. They are hungry, they are scrappy, they are smart and they are building their own Web companies. They love using Facebook, Twitter and Foursquare– for now. But, frankly, the attitude is starting to piss many of the most Web savvy ones off. And every entrepreneur knows what pissed off Web users do: They start competitive companies. At the conference yesterday several people challenged the usual bragging that Indonesia is Facebook’s second largest market, saying “Why do we need to use Facebook? Why can’t everyone else use an Indonesian site?” Sure it’s just the Web elite saying it now, but the drumbeat is starting.
I know Indonesia isn’t a priority when you’re growing at the speed of Facebook, Twitter and Foursquare. Indeed, it’s a brutally hard market to monetize with a nascent advertising market and little ecommerce to speak of. Only about 3% of the population even has credit cards. And it’s not always a comfortable market to be in: The traffic is horrible, I went through four SIM cards before finding one that worked, and I’ve had little luck getting a consistent Web connection this week. And I doubt many of you speak Bahasa. But you’re not going to understand this customer any better sitting in the Valley. (I don’t speak Bahasa either, for the record, but after 40 weeks in emerging markets I could beat you all at charades.)
You can’t have it both ways, Web 2.0 elite. You can’t brag in local presentations about how global your reach is and not visit one of your largest markets. You can’t trumpet that it’s a brave new Web world with two billion global users and only cater to the first billion.