Indonesia: Regulating the Sale and Provision of Digital Content through Mobile Cellular Networks
With the continuous and rapid advancement of technology and the increase in the use of digital technology, the provision and sale of digital content has become more and more appealing. This is evident from the emergence of a plethora of businesses the activities of which include engaging in the sale of digital content such as video games, ring back tones, music and videos as well as the rise in the demand for digital content sold through mobile phones. As the world’s 4th most populated country with over 120 million active smart phone users,1 Indonesia has naturally become an attractive place for investment in the digital content sector. Given the size of the potential market and the growing business interest, the Indonesian government try to protect the interests of both consumers and content providers by issuing Minister of Communication and Informatics Regulation No. 9 of 2017 on The Administration of Content-Providing Services in Mobile Cellular Networks (“MOCI Reg 9/2017”) on the sale of digital content.
MOCI Reg 9/2017 covers the provision of digital content, with payment for the purchase being deducted from mobile phone credits or invoiced to the mobile phone user in a post-paid mobile services arrangement. This regulation does not regulate digital content with payment not being paid through Indonesian telecommunications services (such as Telkomsel, XL, Indosat etc). Under MOCI Reg 9/2017, ‘digital content’ is defined as all forms of information which may be in the form of writing, images, sounds, animations, or any combination of them, in digital form, including software applications to be downloaded. This includes the sale of among other things, ring back tones (RBT), online game credits/vouchers, music, and short message service (SMS) subscriptions. As digital content constitutes goods that can be sold remotely, MOCI Reg 9/2017 regulates not only digital content providers targeting the Indonesian market that are located in Indonesia (“local digital content providers”), but also those located outside of Indonesia (“foreign digital content providers”).
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