Blackberry, Indonesia, Malaysia

Blackberry smart-phone producer RIM recently announced that it will set up a factory in Malaysia.

This decision has angered the Head of the Investment Coordinating Board (BKPM) Gita Wirjawan who said that RIM should consider Blackberry's market in Indonesia as a factor, whereby every year RIM sold 4,000,000 smart-phones in Indonesia, compared to only 400,000 in Malaysia.

In this connection I would like to share with you an article (below) written by a PR Consultant in Jakarta, i.e. Unspun on his blog: http://theunspunblog.com.

Introspection, not revenge, needed over loss of RIM to Malaysia

Investment Coordinating Board Chairman Gita Wirjawan is right to ask why indeed would a company like RIM that has exponentially more consumers in Indonesia and Malaysia choose the latter for its production base. It makes little financial and political sense.

Gita is also right to speculate that it may be because Indonesia last year required RIM to set up a regional network aggregator, or data center, in the country, establish at least 40 authorized customer care centers, facilitate lawful interception of its encrypted BlackBerry Messenger services by officials and filter pornographic content.

But he does not ask and speculate on the important questions: Were there other factors behind RIM’s decision to locate its base in Malaysia? Is Indonesia’s corruption and lack of legal certainty a factor? What about the red tape in setting something like this up here, compared to Malaysia? And how much of a concern should IT and communications-related companies have over an Information Minister as mercurial as Tifatul?

But at least Gita did make an effort at asking. The Industry Minister just went straight for the revenge bit. Companies make business decisions based on what’s good for their business. Being close to their market and winning the goodwill of their largest markets are very important factors for businesses in their decision-making processes. Unspun is sure that RIM, and Bosch for that matter, considered the pros and cons of Indonesia and Malaysia carefully and the sad truth, for them, is that the cons in Indonesia outweigh the very strong pro of a huge consumer base in Indonesia.

Instead of acting with the fury of a woman scorned the Indonesian ministers would do well to do, as the late Suharto would have advised, some introspection on what Indonesia needs to change to make itself more attractive as an investment destination. Or at least to mitigate the cons that help outweigh its pros of a huge population and market, a stable and growing economy and vast store of resources.

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