Interest Of AI Users In Indonesia Explodes, But Local AI Startups Are Still Minimal

Illustration of artificial intelligence (photo: Unsplash)

JAKARTA - Southeast Asia is rapidly becoming the center of global AI, driven by a rapidly growing ecosystem of adopters, AI startups, and investors. The consumer interest in AI in the region really exceeds the limit even 3 times higher than the global average.

Interestingly, the eConomy SEA 2025 report released by Google, Temasek, and Bain & Company states that Indonesia is in the top 2 countries with the highest Nano Banana users in the world with 18 million image generations every day.

But unfortunately, the very strong interest and adoption of AI from consumers is not in line with the number of AI startups available. This shows that there is a gap between Indonesia as a consumer and producer of AI.

Because, this report sees that in Southeast Asia, there have been more than 680 active AI startups that have been established since 2020, where Singapore is the main center with more than 495 companies, Malaysia 60 companies, Indonesia 45 companies, Vietnam 40 companies, Thailand 20 companies, and the Philippines 10 companies.

Responding to this phenomenon, Google Indonesia Country Director Veronica Utama stated that the main factor is the lack of an ecosystem that encourages this innovation.

"Among them are in terms of skilling or improving the capabilities of the developers themselves. So, how do we also ensure that developers and engineers in Indonesia also control AI," Veronica said on Thursday, November 13 at the Google Indonesia office, Jakarta.

Veronica also explained that there are fundamental differences between AI startups and conventional technology startups. AI startups, he said, require high computing power and large initial capital (capex) to operate.

"So indeed the barrier to entry (barrier to entry) is higher," he explained.

Furthermore, Veronica said that currently the world of startups is also entering a new era, where investors are increasingly demanding a clear path of profitability. "In the past, many startups thought, the important thing was to grow fast first, monetization later, now it has changed," he said.

According to him, this awareness is actually good because it encourages the emergence of more sustainable companies. Although the challenge towards getting there is not easy, Veronica is optimistic that Indonesia's opportunity to become a big AI player is very wide open.

Therefore, he emphasized the importance of connecting investors with developers who have innovative ideas in the AI sector, in order to create more startups that are able to create original solutions made in Indonesia.

"So, it's a bit more refined and it's a hard challenge, I would say, but we want to push it. Come on, this is the opportunity. We just need more great people and ecosystems to get it there," he concluded.