JAKARTA. The competition of e-commerce in the markets of South East Asia, including Indonesia will be heating up. Two giant global e-commerce players Alibaba Group Holding Ltd and Amazon.com Inc will vie for the online shopping markets in the region with 620 million populations.

According to Bloomberg, the competition is related to the ambition of the two companies to be the largest online shopping site in the world. Amazon failed to beat Alibaba in China, but it becomes the largest online site in India, surpassing the local site Flipkart and Snapdeal.

Meanwhile, Alibaba, which is owned by Jack Ma, becomes stronger in South East Asia. After purchased Lazada from Rocket Internet as much as US$ 1 billion, in the last October Alibaba took over the ownership of Singapore based online food wholesaler RedMart.

According to the CEO of Lazada Inc Maximilian Bittner, South East Asia region, including Indonesia has a high potential online business market. Maximilain estimates that the total transaction in the region has increased by 2.5 times compared with the last year.

Amazon actually has detected the potential market. Based on KONTAN record, the Association of Indonesian e-commerce (iDeA) once mentioned that Amazon will likely penetrate the Indonesian market. Amazon, which is led by Chief Executive Officer Jeff Bezos, even has prepared up to US$ 600 million funds to penetrate to Indonesia.

To date, there is no confirmation whether Amazon will penetrate to Indonesia. However, on 15 December Amazon Prime Video, which provides video on demand service, has started operating in Indonesia. This video on demand service has been available in 200 countries, including Indonesia.

An online site revealed that Amazon is ready to start business in Singapore in early next year. In other words, Amazon is ready to challenge the aggressiveness of Alibaba in this region. According to General Chairman of iDEA Aulia Ersyah Marinto said that the presence of global players is unavoidable in online business.

Under the current conditions, he hopes that the local online entrepreneurs are ready to face the competition with the giants. “We have seen that the foreign players become more aggressive in this sector,” said Chief Executive Officer Blibli.com Kusumo Martanto.

Aulia suggested the local online entrepreneurs to be optimistic, as the government has prepared e-commerce roadmap, which can be guidance in developing e-commerce business.

Aulia did not reveal the largest online company. However, it is the old player and has spent a large amount of funds.

Online entrepreneurs are now improving the payment system. One of local players, which is part of big conglomeration, has developed an application of payment system. Currently, the company is testing this system on its employees.

(Muhammad Farid/Translator)

Editor: Dupla Kartini