Sidebar Sidebar
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.

Apple's $1 Billion Investment May Soon End Indonesian iPhone Ban

MacRumors

MacRumors

macrumors bot
Original poster
Apr 12, 2001
67,530
37,842


Apple is close to reaching an agreement with Indonesia to lift the ban on iPhone 16 sales in the country after securing preliminary approval for a $1 billion investment proposal, according to Bloomberg.

iPhone-16-Apple-Store.jpg

Indonesian President Prabowo Subianto is said to have given his support for the government to accept Apple's investment plan following a weekend briefing. The proposal includes establishing manufacturing facilities in the country, with one of Apple's suppliers set to build an AirTag production plant on Batam island.

The Batam facility is expected to initially employ 1,000 workers and will eventually account for 20% of global AirTag production. The location was chosen for its free-trade zone status, which provides tax exemptions and import duty benefits.

Additional investments will fund a separate manufacturing facility in Bandung for producing other accessories, as well as expanding Apple's existing developer academies in Indonesia. President Prabowo has directed his Economic Affairs Ministry to finalize the agreement, but no specific timeline has been provided for lifting the iPhone 16 sales ban.

The ban was implemented in October after Indonesian authorities determined Apple had failed to meet the country's requirement for 40% domestic content in smartphones. Apple's latest proposal represents a significant increase from its previous offers of $10 million and $100 million, which were rejected by the government.

If approved, the deal would mark a success for President Prabowo's efforts to attract foreign investment while demonstrating the effectiveness of Indonesia's strategy to pressure international companies into developing products locally. The country remains a significant market for Apple, with over half of its 278 million residents under the age of 44.

Note: Due to the political or social nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Article Link: Apple's $1 Billion Investment May Soon End Indonesian iPhone Ban
 
Article Link
https://www.macrumors.com/2024/12/19/apple-nears-deal-to-end-iphone-16-ban-indonesia/
Last edited:
Looks like Indonesia played a game of regulatory chicken with Apple and won a billion-dollar prize !

Suddenly, those "local content" rules seem awfully convenient for attracting foreign investment, eh?
Wonder if Tim feels like he got a fair deal or just a really expensive business permit... 🤔
 
Last edited:
  • Like
Reactions: amartinez1660 and PowerButton
wbeasley said:
every country will try this now... give in to extortion once and you set a dangerous precedent... :(
Click to expand...

not that many countries with ±280 mil citizens that are sitting on large chunk of tin which Apple sources from them... did you cry also when Indian government pushed Apple to build factories there to avoid luxury import taxes?
 
Last edited:
Meanwhile, the EU/UK’s inability to ban ANYTHING Apple makes gets them NOT the equivalent of 1 billion dollars.

Of course, it’s clear to see why. Indonesia hasn’t made the decision to base their entirety of their tech future partially on a device made by Apple. The EU/UK has.
 
Last edited:
Jay Tee said:
Looks like Indonesia played a game of regulatory chicken with Apple and won a billion-dollar prize! Suddenly, those "local content" rules seem awfully convenient for attracting foreign investment, eh? Wonder if Tim feels like he got a fair deal or just a really expensive business permit... 🤔
Click to expand...
I think he opened a Pandora’s box.
 
  • Like
Reactions: Jay Tee
mavis said:
Sounds like extortion to me. 😐
Click to expand...

How is it extortion?

If Apple wants to do business in Indonesia and access Indonesia customers, they have to meet Indonesia requirements (e.g., 40% domestic content, some sort of investment, pay taxes, etc.) and if app developers want to do business on iOS and access iOS customers (at least for the non-EU markets), they have to meet Apple requirements which includes paying Apple to sell apps/in-app products.

Both the Indonesia and iOS/app scenarios are legal, unlike extortion.
 
  • Like
Reactions: CarpalMac and StoneJack
sparkie7 said:
Apple bean-counters would have done their calculations, spreadsheets + projections. It was a business decision that favoured Apple. Otherwise they wouldn't have done the deal.
Click to expand...

Which makes that initial $10 million offer sound like an insulting lowball if it was actually worth $1 billion.

If this is the kind of negotiating Apple usually does, I’m not surprised they don’t get along well with most other companies.
 
sparkie7 said:
Apple bean-counters would have done their calculations, spreadsheets + projections. It was a business decision that favoured Apple. Otherwise they wouldn't have done the deal.
Click to expand...
Yes, of course. Indonesia has a quarter of a billion people living there. All Apple has to do is make 40 cents per year from each person over the next 10 years. The investment is trivial compared to the potential return.

Indonesia is something like 3/4 the size of the US. Apple could not afford to walk away from a market that large.
 
webkit said:
How is it extortion?

If Apple wants to do business in Indonesia and access Indonesia customers, they have to meet Indonesia requirements (e.g., 40% domestic content, some sort of investment, pay taxes, etc.) and if app developers want to do business on iOS and access iOS customers (at least for the non-EU markets), they have to meet Apple requirements which includes paying Apple to sell apps/in-app products.

Both the Indonesia and iOS/app scenarios are legal, unlike extortion.
Click to expand...

Looking forward to your support for the incoming American administration demanding that foreign companies pay a billion dollars before being able to sell their products in the US!
 
  • Like
  • Love
Reactions: wbeasley, I7guy, freedomlinux and 2 others
Unregistered 4U said:
Meanwhile, the EU/UK’s inability to ban ANYTHING Apple makes gets them NOT the equivalent of 1 billion dollars.

Of course, it’s clear to see why. Indonesia hasn’t made the decision to base their entirety of their tech future partially on a device made by Apple. The EU/UK has.
Click to expand...
The EU made $16B in fines alone from Apple. Why would they kill a cashcow when they already know how to milk it.
 
You must log in or register to reply here.
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.
Top Bottom
Back