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Apple invests $44M into Indonesian R&D to unlock local iPhone sales

Apple has reportedly agreed to invest $44 million in an Indonesian research and development center, in a move likely geared mainly toward opening up sales of the iPhone 7, as well as future iPhones.

Starting in January, all 4G phones sold in Indonesia must meet a requirement of 30 percent local content, Reuters explained on Friday. While a similar rule exists in India, in Indonesia, this can be met with software or investment and not just physical components — Apple received a "local content certification" in November, according to a director-general from the country's industry ministry, Gusti Putu Suryawirawan.

The $44 million will be spent over three years, Suryawirawan said, letting the company sell iPhones priced at $448 and above, which includes every current model.

Apple will have to take ground from firmly established Android phone makers if it wants a share of the Indonesian market. Samsung has a 26 percent share in the country, followed by Oppo's 19 percent, and both of those companies offer cheaper alternatives to the iPhone in their product lines.

The region does have a population of over 250 million people however, likely offering Apple enough room to capture at least part of the high-end smartphone market.



9 Comments

gatorguy 14 Years · 24654 comments

Money well-spent. Can't imagine how only $40M over three years would meet the "30% local content" requirement of the existing law but why look a gift horse in the mouth? Nice job by whoever negotiated it. 

1 Like · 0 Dislikes
usersinceos1 10 Years · 145 comments

Bribery by any name....  It used to be illegal for American businesses to bribe foreign officials to obtain their business, but I guess not anymore.  How much of that $40M will help the people and economy of Indonesia, and how much will end up in the (foreign) bank accounts of the leaders?

1 Like · 0 Dislikes
auxio 20 Years · 2778 comments

Bribery by any name....  It used to be illegal for American businesses to bribe foreign officials to obtain their business, but I guess not anymore.  How much of that $40M will help the people and economy of Indonesia, and how much will end up in the (foreign) bank accounts of the leaders?

And it's Apple's job to reform this government corruption? (if it does exist -- you haven't given any proof)  How many of their competitors have done the same to get business in the area?  Maybe think a bit more deeply on a real solution to these problems before you turn it into a crusade against one company.

3 Likes · 0 Dislikes
spice-boy 9 Years · 1450 comments

Bribery by any name....  It used to be illegal for American businesses to bribe foreign officials to obtain their business, but I guess not anymore.  How much of that $40M will help the people and economy of Indonesia, and how much will end up in the (foreign) bank accounts of the leaders?

Here is an excerpt from Reuters link which Appleinsider provided… 

"Apple received a "local content certification" in November, I Gusti Putu Suryawirawan, director-general for metal, machines, transport equipments and electronics at the industry ministry, said in a text message.

An Apple spokeswoman declined to confirm the investment figure, but pointed to an announcement last year that the U.S. tech company had committed to build an iOS App Development Center in Indonesia."

This is not a bribe but how and actual "deal" looks.

2 Likes · 0 Dislikes
usersinceos1 10 Years · 145 comments

auxio said:
Bribery by any name....  It used to be illegal for American businesses to bribe foreign officials to obtain their business, but I guess not anymore.  How much of that $40M will help the people and economy of Indonesia, and how much will end up in the (foreign) bank accounts of the leaders?
And it's Apple's job to reform this government corruption? (if it does exist -- you haven't given any proof)  How many of their competitors have done the same to get business in the area?  Maybe think a bit more deeply on a real solution to these problems before you turn it into a crusade against one company.

Hold your horses, I wasn't aiming this at Apple, I was only pointing out how the slippery slope has gotten slipperier, and I fully expect it will get even more so going forward