Indonesia’s 1.4 GHz Spectrum Auction Aims to Drive Innovation, Expand Rural Broadband Access

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JAKARTA, investortrust.id — Indonesia’s plan to auction the 1.4 GHz frequency band in July 2025 is drawing praise from economists and industry players alike, as the move is expected to accelerate broadband expansion and enhance competitiveness among telecom operators.

The frequency, dedicated to fixed broadband rather than mobile use, is seen as a cost-effective solution to extend affordable internet access to rural and underserved areas, offering speeds of up to 100 Mbps without requiring fiber-optic infrastructure.

Nailul Huda, Director of the Center of Economic and Law Studies (CELIOS), said the auction model will push operators to optimize their use of frequency spectrum and foster innovation in service delivery. “A competitive bidding process is far more effective than allocating frequencies based on an operator’s current capacity,” Huda told Investortrust on Friday, July 18.

He warned that without a transparent and merit-based auction, telecom services risk stagnation. “If allocation is based on existing capabilities, there will be little incentive for companies to expand or improve network quality,” he said, adding that auction outcomes also reflect an operator’s willingness to invest in long-term infrastructure and innovation.

 

Government Targets Rural Internet Rollout

The Ministry of Communication and Digital (Kemenkomdigi) has earmarked 80 MHz of spectrum in the 1.427–1.518 GHz band, to be auctioned across three geographic zones: Java-Papua, Sumatra-Bali-Nusa Tenggara, and Kalimantan-Sulawesi. The licenses, issued through the Radio Frequency Band License (IPFR) scheme, allow operators regional flexibility in rollout.

“We’re aiming to start the selection process this July,” said Wayan Toni Supriyanto, Director General of Digital Infrastructure at Kemenkomdigi. “This spectrum is exclusively for fixed broadband, not mobile. The goal is to increase broadband penetration in areas not yet served by fiber networks.”

Kemenkomdigi emphasized that while licensees are free to operate nationwide, the ministry encourages them to prioritize rural deployment before expanding into dense urban areas. The government will not impose fixed pricing but expects bidders to offer affordable tariffs based on their business models.

Industry Response: “Win-Win” or Rethink?

Telkomsel, Indonesia’s largest mobile operator, welcomed the auction initiative, though it stressed the need for a balanced and collaborative approach. “We support the government’s plan. What’s important is a win-win spirit between regulators and industry players,” said Saki H Bramono, VP of Corporate Communications and Social Responsibility at Telkomsel, on Tuesday, July 15.

Other operators such as XLSmart and Indosat Ooredoo Hutchison have proposed alternative models, including proportional spectrum allocation, dynamic sharing, and revised spectrum fees to lower investment risks. These players argue that an overly aggressive bidding war may divert funds from network expansion, especially in high-cost rural zones.

Technology observer Heru Sutadi, Executive Director of ICT Institute, echoed this concern. “If spectrum is distributed proportionally, operators can channel more funds into infrastructure development instead of securing licenses,” he said.

EMC Testing and Infrastructure Oversight

Ahead of the broader 5G rollout, Kemenkomdigi is also tightening standards on electromagnetic compatibility (EMC) testing. “EMC is more than a technical requirement — it is the foundation of trust in telecom devices,” Wayan said during a press briefing on June 4.

Indonesia’s main telecom testing lab, National Telecommunications Equipment Testing Center (BBPPT), has grown into the largest such facility in Southeast Asia following a major upgrade in 2024. It now serves as a regulatory gatekeeper to ensure only certified, safe, and high-quality devices enter the domestic market.

The lab’s triple mandate — protection, quality assurance, and spectrum management — is part of Indonesia’s push to strengthen its digital infrastructure in preparation for broader 5G spectrum auctions, including the 700 MHz, 2.6 GHz, and 26 GHz bands.