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Steady Progress Driven by the Ministry of Communication and Informatics
Technologies such as the Internet of Things (IoT), machine learning, and blockchain are often viewed as the pinnacle of rapid internet development over the past few decades. These advancements have also changed the way we engage and interact with the digital realm.
Nonetheless, these technologies are built upon a foundation of Internet Protocol (IP) addresses, specifically the widely used IPv4, which was commercially launched in 1986. Although many perceive the internet as an infinite resource, the reality is that IPv4 is reaching its limits in terms of usability due to its constrained address space of approximately 4.29 billion addresses. Consequently, the system often resorts to Network Address Translation (NAT), which allows multiple devices within a private network to share a single public IP address.
In contrast, IPv6 has been introduced to address the shortcomings of IPv4, making it suitable as the internet protocol for the next generation. IPv6 offers a sheer number of address space of 3.4 x 10^38 addresses, which will effectively resolve the IP address shortage for the foreseeable future.
How is the Indonesian Government Encouraging the Transition to IPv6?
Indonesia’s high level of internet activity indicates a substantial potential for domestic internet applications, including e-commerce, news portals, banking, and entertainment. The growth of these applications necessitates a significant allocation of IP addresses. Thus, the Government of Indonesia sees that accelerating IPv6 adoption in Indonesia is imperative. Therefore, in 2014, the Ministry of Communications and Informatics (“MCI”) introduced a roadmap for transitioning to IPv6 under MCI Regulation No. 13 of 2014 (“MCI Regulation 13/2014”).
For the past decades, the MCI has actively promoted the shift from IPv4 to IPv6 by implementing several initiatives, including (i) conducting IPv6 trials; (ii) establishing and refreshing the IPv6 Task Force (ID-IPv6TF); (iii) allocating IPv6 prefixes through the Indonesia Network Information Center (IDNIC); and (iv) implementing the Indonesia IPv6 Tunnel Broker through the Indonesian Internet Service Providers Association (APJII).
What are the Recent Updates on IPv6 Transition?
The MCI advanced its efforts to transition to IPv6 by issuing Circular Letter No. 6 of 2024, which encourages telecommunications providers to activate and use Internet Protocol Version 6 (IPv6) (“MCI Circular 6/2024”). This circular specifically targets participation from telecommunications providers, among others are internet service providers, network access providers, internet protocol television providers, and internet telephony providers.
The circular outlines two key directives:
As the circular’s title suggests, these regulations aim to accelerate the transition from IPv4 to IPv6 in Indonesia.
Telecommunications providers are expected to naturally expedite this process, however, there has yet to be a definitive stance from the MCI regarding incentive policies related to this transition. Regardless, it is anticipated that other key stakeholders, such as the Ministry of Finance, will have to play a role in implementing tax or fiscal incentives associated with the said transition.
Whilst the transitional policy is now considered a public secret, all telecommunications providers operating in Indonesia will eventually be subjected to the above compliance requirements set by the MCI. We have continued to monitor and strongly view that it is a key consideration in weighing the future implications on how this regulation will affect the entire industry and the inferences that should be drawn from its impact.
To ensure eventual mandatory compliance, please do reach out to enquire about this key regulation and its unavoidable impact on the telecommunication sector.
Should you have any inquiries related to this regulation or wish to ascertain its impact on your business or personal interests, please feel free to contact us.
