Sometime around February this year, Malaysian budget airline AirAsia’s flights on routes within Indonesia began vanishing sporadically from Indonesia’s largest online travel agent (OTA), Traveloka. Instead, the platform’s users had to manually check AirAsia’s website or app to see if the airline had better options.

This was no oversight or technical glitch. Or at least, that’s what AirAsia alleged. In March, the carrier, owned by eclectic Malaysian businessman Tony Fernandes, declared it would permanently withdraw all of its flights from Traveloka, Indonesia’s biggest OTA, because it felt unfairly treated by the platform.

“The exclusion of several AirAsia Indonesia flights by Traveloka is a clear display of preferential treatment and an act of favouritism,” the statement read.

It concluded with a comment from then-AirAsia Indonesia CEO Dendy Kurniawan: “Competition should be free and fair to ensure consumers benefit from the best deals. We should not let monopolies kill competition at the expense of the travelling public.” Kurniawan has recently been succeeded by Veranita Yosephine Sinaga.

An OTA Goliath

Traveloka, Indonesia’s largest OTA, was among the first official tech unicorns in Southeast Asia. Today, it boasts a valuation of around $4.5 billion and major investors like American travel giant Expedia, VC firm Sequoia and Chinese tech heavyweight JD

AirAsia’s tenuous relationship with OTAs has only worsened since. After its decision to shun Traveloka, AirAsia flights began disappearing from more and more OTA platforms. Most recently, around October, Traveloka-owned Pegipegi—a smaller OTA targeting local travellers—also stopped featuring the company.

In October, several customers questioned why AirAsia no longer showing up in Pegipegi search results. The OTA's Twitter customer service channel asked customer to book other airlines instead.

Today, AirAsia has severed ties with Indonesia’s OTAs altogether, choosing instead to fly solo. Its lack of a footprint on these platforms, though, presents a significant hurdle to its growth in the country. According to market research firm RedSeer, the overwhelming majority—96%—of online travel bookings in the country happen through either Traveloka, Tiket (the second largest Indonesian OTA), or Pegipegi.

Already, despite consistent growth in demand over the last two decades, Southeast Asian airlines struggle to attain profitability. Operational inefficiencies, price-sensitive customers, fuel price fluctuations and the effects of digital disruption have made the space a turbulent one.

In Indonesia, the region’s biggest aviation market with gross merchandise value of online flight bookings touching the $10 billion mark, the industry’s cut throat struggle for survival has reached a whole other level. Competition has bittered to a point where fair play seems to have gone out the window—and AirAsia off digital platforms.

Analysts and insiders believe that Indonesia’s two main domestic airline groups—national airline Garuda and its affiliates on one side, and low-cost carrier Lion Air Group on the other—have skewed the playing field.

AUTHOR

Nadine Freischlad

Nadine is based in Indonesia. She covers Southeast Asia's super apps, the changing nature of work and employment, and other structural shifts happening as a result of digital disruption.

View Full Profile

Read this story. Subscribe Now

This story is available across both editions. Subscribe to the one that’s most relevant for you. Questions?

 

Premium

  • 5 original and reported longform business stories every week
  • Access to ONLY India edition
  • Close to 250 exclusive stories every year
  • Full access to over 5 years of paywalled stories
  • Pick up to 5 premium subscriber newsletters
  • 4 original and reported longform business stories each week
  • Access to ONLY Southeast Asia edition
  • Close to 200 exclusive stories every year
  • Full access to all paywalled stories since March 2020
  • Pick up to 5 premium subscriber newsletters

Rs. 2,750 /year

$ 120 /year

India Edition
Subscribe Subscribe
Most Asked For

Borderless

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories

Rs. 4,200 /year

Subscribe
 

Echelon

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories
  • Bonus annual gift subscription
  • Priority access to all new products and features

Rs. 8,474 /year

Subscribe
Or

Questions?

What kind of subscription plans do you offer?

We have three types of subscriptions
- Premium which gives you access to either the India or the Southeast Asia edition.
- Borderless which gives you complete access to The Ken across both editions
- Echelon which gives you complete access to The Ken across both editions along with a bonus gift subscription

What do I get if I subscribe?

The Premium edition gives you access to stories in that edition along with any five subscriber-only newsletters of your choice.

The Borderless and Echelon subscription gives you complete access to The Ken across editions and unlimited access to as many newsletters as you like.

What topics do you usually write about?

We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics. We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

Our specialised subscriber-only newsletters are written by our expert, award-winning journalists and cover a range of topics across finance, retail, clean energy, cryptocurrency, ed-tech and many more.

How many newsletters do you have?

We are constantly adding specialised subscriber-only newsletters all the time. All of these are written by our team of award-winning journalists on a specialised topic.

You can see the list of newsletters that we publish over here.

Does a Premium subscription to your Indian edition get me access to the Southeast Asia edition? Or vice-versa?

Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

We recommend the Borderless or the Echelon Plan which will give you access to stories across both editions.

Do you have a mobile app?

Yes! We have a top-rated mobile app on both iOS and Android which allows you to read on-the-go and has some amazing features like the ability to bookmark stories, save on your device, dark mode, and much more. It’s really the best way to read The Ken.

Is there a free trial?

You can sign up for a free account to experience The Ken and understand our products better. We’ll send you some free stories and newsletters occasionally, and you can access our archive of previously published free stories. You can stay on the free account as long as you’d like.

The vast majority of our stories, articles and newsletters can be accessed only by a paid subscription.

Do you offer any discounts?

Sorry, no. Our journalism is funded completely by our subscribers. We believe that quality journalism comes at a price, and readers trust and pay us so that we can remain independent.

Do you offer refunds?

No. We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.

I am facing some trouble purchasing a subscription. What can I do?

Just write to us at support@the-ken.com with details. We’ll help you out.

I have a few more questions. How can I reach out to you?

Sure. Just email us at info@the-ken.com or follow us on Twitter.