Pros And Cons Starlink Presence: The Threat Of Predatory Pricing And National Security Risks

Minister of Health Budi Gunadi Sadikin together with SpaceX CEO Elon Musk launched the Starlink satellite-based internet service at the Sumerta Klod Assistant Health Center, Denpasar, Bali, Sunday (19/5). (ANTARA/Muhammad Adimaja)

JAKARTA Starlink's presence in Indonesia triggers pros and cons. In addition to allegations of predatory pricing, Starlink's presence is also considered to threaten state security. But on the other hand, Starlink can provide equal internet access, especially in hard-to-reach areas.

Elon Musk launched a Starlink service in Denpasar, Bali, Sunday (19/5/2024), along with the inauguration of a collaboration with the Ministry of Health. This collaboration aims to provide internet access for a number of health centers in remote areas, borders, and islands that have been difficult to reach by conventional internet services.

Hari ini resmi jadi pengguna starlink. Thank you @Starlink @elonmusk to bring this innovation. pic.twitter.com/B7VHNlIa0H

— indra (@drayanaindra) May 3, 2024

Today is officially a starlink user. Thank you @Starlink @elonmusk to bring this innovation. pic.twitter.com/B7VHILA0H

It didn't take long, Starlink's entry into Indonesia immediately became a hot topic of conversation. Local businessmen accused Starlink of predatory pricing so that it was feared that it would cause unhealthy competition.

Starlink is a satellite-based internet system SpaceX developed in 2015, with orbits relatively close to the Earth's surface or low earth orbit (LEO). Starlink does not use fiber optic cables, but rather controls the constellations of thousands of small low-orbit satellites to send data at high speed.

Simply put, Starlink sends internet data via radio waves to satellites in orbit, which then forwards it to users in various hemispheres.

Since early 2022, Starlink services have been available in most areas in North America, Europe, Australia, and several Asian countries. However, the availability of its services relies on a number of factors including geographical conditions, local government regulations, to available satellite capacity.

"Starlink is now available in 32 countries around the world. Users who have ordered Starlink from the 'availability' area will get access to their Starlink internet as soon as possible," SpaceX wrote in an X post.

Apart from the US, countries that already use Starlink include Australia, Brazil, Chile, Croatia, Japan, the Philippines, and Malaysia.

Then in early May, Starlink began marketing the 'Residential' internet package for Indonesian consumers, with a subscription fee of IDR 750,000 per month and hardware of IDR 7.8 million. They also display details of the price for other packages, namely Clopes and pals' each with the lowest monthly subscription fees of IDR 990,000 and IDR 4.3 million.

Chairman of the Association of Indonesian Internet Service Providers (APJII) Muhammad Arif Angga admitted that he was surprised to see the price of the 'Standard' package for the 'Residential' category. The price of IDR 750,000 per month set in Indonesia is considered much cheaper with similar packages abroad.

In comparison, the Standard' package in the US is offered for 120 US dollars or equivalent to Rp. 1.9 million per month. However, the same package in Malaysia is sold for 220 ringgit a month, approximately equivalent to Rp. 750,000.

According to Arif, the government needs to pay more attention to Starlink's price strategy which is feared to damage domestic markets.

"We ourselves have been operating for a long time, we have also contributed a lot to the government in terms of PNBP, taxes, and others. So we think the government should have a national interest," said Arif.

Arif added that Starlink's presence should not let it take up the business of friends who have been operating in Indonesia for a long time. He assessed that Starlink will suppress the internet business with a fiber optic network or fixed broadband in suburban areas.

Meanwhile, in urban areas, Starlink's presence will not have much impact on the old players. This is because fixed broadband services in urban areas can be obtained at a more affordable price, an average of between Rp. 100,000 and Rp. 300,000.

The concern about potential predatory pricing or selling losses by Starlink was also expressed by the executive director of the Indonesia ICT Institute Heru Sutadi. According to him, predatory pricing can lead to unhealthy competition, especially since Starlink is currently wary of discounts for hardware prices.

Customers are required to buy hardware for IDR 7.8 million at the beginning, but the price is discounted to only IDR 4.68 million until June 10.

Indonesian people are price-sensitive. If there are two services, which one is cheaper is chosen," said Heru.

"We don't know in the future, it could be that Starlink will also hit the price. The speed is reduced, the price is cheaper. It could be crowded with its customers," he added.

In addition to the possibility of predatory pricing, Starlink services are considered to have the potential to be used by terrorist groups or separatists to coordinate or plan something that threatens national security.

That's why the government should have access to oversee Starlink data traffic.

"If you use a BTS (base transceiver station), you will find out, the position here is this person, for example on the mountain. But if you use satellite, it will be difficult to detect," said Hargyo Tri Nugrogo, a computer engineering lecturer at Multimedia University, Nusantara (UMN).

However, cyber technology observer and IT security network, Alfons Tanujaya, criticized those who were worried and skeptical about Starlink's presence. He also rejected the protection policy of domestic telecommunications business players because it would kill the development of the technology itself. Especially if you look at the DNA of the technology industry, it does provide more advanced and sophisticated services than before.

"If you are not ready to face this reality, it might be better for companies that shout not to move in the IT and Telco fields but to trade basic necessities," he said.

Meanwhile, in response to potential data security, according to Alfons, optical cable internet providers also have similar threats. The reason is that fiber optics in internet data traffic abroad also passes through countries such as Singapore and Australia (fiber optic cable submarine).

"The point is in openness, how Starlink provides access to the government to carry out surveillance," he explained.

"Some say you are afraid to spy on because you are using Starlink, but do you realize that you are using Whatsapp, Google Maps and Android phones or iPhones yourself have been voluntarily stalked? If you don't spy on the United States software rulers, you'll be with the Chinese hardware rulers," Alfons concluded.