ATSI Warns Banning Internet Quota Expiry Risks Higher Tariffs & Strain

Potential Tariff Hikes and Network Strain Loom Over Indonesia's Digital Landscape

The Indonesian Telecommunications Providers Association (Asosiasi Penyelenggara Telekomunikasi Seluruh Indonesia - ATSI) has issued a stark warning regarding the potential repercussions should the Constitutional Court (Mahkamah Konstitusi - MK) approve a judicial review challenging the practice of expiring unused internet quotas. Adnial Roemza, legal counsel for ATSI, highlighted several critical consequences, including a potential rise in internet tariffs and the risk of network congestion, which could significantly impact Indonesia's digital ecosystem.

This development stems from a judicial review petition against Article 71 number 2 of Law No. 6 of 2023 concerning Job Creation (Undang-Undang Nomor 6 Tahun 2023 tentang Cipta Kerja), which amends Article 28 of Law No. 36 of 1999 on Telecommunications. The petitioners, an online motorcycle taxi driver and an online culinary vendor, argue that the current system of expiring unused internet quota at the end of its active period is detrimental to consumers.

The Ripple Effect: Higher Costs and Unequal Access

One of the primary concerns raised by ATSI is the potential for increased internet tariffs. Should the prohibition on quota expiry be enacted, it could inadvertently benefit individuals with higher purchasing power, allowing them to accumulate vast amounts of internet access. This hoarding behavior, Adnial explained during a hearing at the MK on Monday (4/5), could create an imbalance, as limited internet capacity would be concentrated among a select few, potentially for purposes not monitored by the state or cellular operators (opsel).

For businesses, particularly SMEs relying on digital platforms for growth, such a scenario could translate into higher operational costs for internet access. This shift in market dynamics underscores the importance of robust market intelligence for brands to anticipate and adapt to changes in consumer behavior and pricing structures.

Network Congestion and Service Quality Degradation

Another critical consequence highlighted by ATSI is the strain on network capacity and the finite radio frequency spectrum. If users can indefinitely accumulate internet quotas, these limited resources could quickly reach their maximum capacity. This would inevitably lead to a scarcity of internet access, hindering connectivity for communities yet to be integrated into the digital network.

Adnial further elaborated that this accumulation would result in network overload. While customers might still connect, the sheer volume of accumulated data on a limited network would drastically reduce internet speeds, leading to a significant degradation in service quality. For businesses, especially those in B2B sectors that depend on seamless online operations and high-speed data exchange, compromised internet quality can directly impact productivity, customer satisfaction, and overall digital authority.

Challenges in Control and Preventing Unauthorized Reselling

The proposed change would also pose significant challenges for both the state and cellular operators in controlling customer behavior. Operators would struggle to manage network capacity effectively and ensure consistent service quality if they cannot predict or regulate data consumption patterns. Furthermore, it could enable individuals to accumulate internet access and resell it without the necessary business permits or regulatory oversight that binds legitimate operators.

This lack of control could foster an unregulated market for internet access, potentially leading to unfair competition and security risks. For brands building digital authority, a stable and regulated digital environment is paramount to ensure secure transactions, reliable data exchange, and trusted online presence.

The Cost of Infrastructure and the Drive for Innovation

ATSI emphasized that the costs incurred by cellular operators are not solely dependent on the volume of data consumed by customers. A substantial portion of their investment goes into procuring and maintaining network infrastructure, as well as covering operational service costs. Operators invest heavily to ensure network capacity is always ready to meet customer demands for access and data exchange every second, according to the chosen internet package.

Despite these significant investments and intense competition, operators are compelled to innovate, creating diverse service models to cater to various societal needs and affordability levels. This constant push for innovation, even under regulatory and competitive pressures, mirrors the imperative for businesses to continuously evolve their digital strategies and offerings to remain relevant and competitive in a dynamic market.

ATSI's Plea to the Constitutional Court

In its petition, ATSI urged the MK to either declare the petitioners' application inadmissible or reject it entirely. The association stressed the necessity of volume and time-bound internet services as integral to managing the inherently limited internet network ecosystem. The ongoing hearing, presided over by Chief Justice Suhartoyo, has also heard testimonies from other major cellular operators like Telkomsel, XL, and Indosat. Future sessions will include statements from the Indonesian Consumers Foundation (Yayasan Lembaga Konsumen Indonesia - YLKI) and the National Consumer Protection Agency (Badan Perlindungan Konsumen Nasional - BPKN).

For businesses leveraging digital platforms, the outcome of this judicial review holds significant implications. A balanced regulatory framework that supports both consumer interests and the sustainability of telecommunications infrastructure is crucial for fostering a robust digital economy, enabling brand growth, and ensuring equitable digital access across Indonesia.