Amazon Web Services (AWS) has released new research highlighting the pace of artificial intelligence (AI) adoption in Indonesia. The findings show that while AI use is spreading quickly among businesses, startups are adopting more advanced AI applications than larger, established companies.
According to the study, 5.9 million businesses in Indonesia adopted AI solutions in 2024. This means about 28% of all Indonesian businesses now use AI, representing a 47% increase from the previous year. Of those that have adopted AI, 59% reported an average revenue increase of 16%, and 64% expect to save an average of 29% in costs.
The survey, titled “Unlocking Indonesia’s AI Potential,” was conducted by AWS in partnership with Strand Partners. It included responses from 1,000 business leaders and 1,000 members of the public across Indonesia.
Despite growing adoption rates, most businesses are using AI for basic tasks such as improving efficiency and streamlining processes. Only a small proportion—11%—have reached an intermediate level of integration, and just 10% have made AI central to their product development or decision-making.
Startups are leading in advanced uses of AI. The research found that 52% of startups use some form of AI, with 34% developing entirely new products powered by the technology. In contrast, only 41% of large enterprises use AI at all; just 21% deliver new AI-driven products or services and only 22% have comprehensive strategies for its deployment.
“It is an interesting phenomenon we are seeing with AI adoption coming out of the study results in Indonesia. While 28% of businesses reported they have adopted AI, most of the deployments remain basic despite the rapid adoption of the technology over the past year,” said Nick Bonstow, Director at Strand Partners. “Larger enterprises are also at risk of being left behind by the nimbler, faster-paced startups. The resulting ‘two-tier’ economy could have lasting implications on a country’s future economic development. Celebrating AI adoption numbers alone masks the deeper challenges many businesses face across Indonesia.”
A lack of skilled personnel is cited as a key barrier to broader and deeper use of AI technologies. More than half—57%—of Indonesian businesses say they struggle to find people with suitable skills despite having access to technology and clear goals for its application. This shortage comes as nearly half (48%) of jobs are expected to require some level of AI literacy in future years; currently only one-fifth (21%) feel their workforce is prepared.
Access to venture capital remains important for startups: according to the survey, 41% see funding as crucial for growth.
Businesses also voiced concerns about regulation. Their main hope is that new rules will boost customer confidence (51%) and provide stability (47%). Currently companies estimate that compliance costs take up a quarter (25%) of their budgets; nearly two-thirds expect these costs will rise over the next three years.
To address these challenges and avoid creating a divided economy between advanced startups and lagging large firms, AWS’s report recommends three steps: investing in digital skills programs tailored to industry needs; creating stable pro-growth regulations; and accelerating government-led digital transformation efforts especially within healthcare and education sectors.
AWS has already made significant investments in Indonesia’s digital infrastructure through its Asia Pacific (Jakarta) Region launched in 2021 with $5 billion committed through to 2036—a move estimated by AWS to create almost 25,000 jobs per year and contribute $10.9 billion USD to national GDP during this period.
AWS says it is committed to closing Indonesia’s digital skills gap through training initiatives like AWS Skill Builder, AWS Educate, AWS re/Start and local projects such as Terampil di Awan (“Skillful in cloud”). These programs aim to prepare students—including those from underserved communities—for opportunities within an increasingly digital economy by teaching cloud computing and generative AI skills.
“Celebrating AI adoption numbers alone masks the deeper challenges many businesses face across Indonesia,” said Nick Bonstow.
