Why in Indonesia can't implemented on premise in AI things (for now) ?

Implementing on-premise AI solutions in Indonesia faces several challenges, including:

1. High Infrastructure Costs – Setting up and maintaining AI servers, GPUs, and storage solutions is expensive. Many companies prefer cloud-based solutions to avoid these upfront costs.

2. Limited Local Expertise – AI infrastructure requires skilled engineers and IT professionals, which can be scarce. Many companies lack in-house AI and DevOps expertise.

3. Electricity and Cooling Issues – Running AI servers requires stable electricity and effective cooling. Indonesia’s infrastructure may not always support this efficiently, especially outside major cities.

4. Scalability Challenges – On-premise solutions are harder to scale compared to cloud-based AI, which allows businesses to expand resources as needed.

5. Regulatory Uncertainty – Data protection and AI regulations in Indonesia are still evolving. Some companies hesitate to invest in on-premise AI without clear guidelines.

6. Cloud Dominance – Many enterprises prefer cloud AI solutions (AWS, GCP, Azure) because they provide flexibility, lower maintenance, and continuous updates without large capital investment.

How costly ? ( Here are the rough ideas )

The cost of implementing on-premise AI in Indonesia depends on several factors, including hardware, software, energy consumption, and maintenance. Here’s a rough breakdown:

1. Hardware Costs

• AI Servers (GPU-based like NVIDIA A100, H100, or DGX systems) → $20,000 – $200,000+ per unit

• Storage (HDDs, SSDs, or enterprise-grade storage solutions) → $10,000 – $100,000

• Networking Equipment (Switches, Routers, Firewalls) → $5,000 – $50,000

  
  

2. Software & Licensing

• AI Frameworks & Enterprise Solutions (TensorFlow, PyTorch, proprietary AI tools) → Free to $100,000+ (for enterprise licenses)

• Operating System & Security Software → $1,000 – $20,000 per year

  
  

3. Energy & Cooling Costs

• Electricity (AI servers consume 2-10 kW per unit) → Estimated $1,000 – $5,000 per month, depending on usage

• Cooling Systems (Air conditioning, liquid cooling for data centers) → $10,000 – $50,000+

  
  

4. Maintenance & IT Personnel

• IT & AI Engineers (Hiring DevOps, AI Engineers, and Security Experts) → Salaries range from $20,000 – $100,000 per person per year

• Server Maintenance & Repairs → $5,000 – $50,000 per year

  
  

Total Estimated Costs (Rough Approximation for Mid-Sized AI Setup in Indonesia)

• Initial Setup → $50,000 – $500,000+

• Annual Maintenance & Operation → $20,000 – $200,000+

Are you sure Indonesia business companies ready for this ? ( within next 5 - 10 years )