Indonesia is drafting a landmark revision to its copyright law that would make it the first Southeast Asian nation to explicitly regulate artificial intelligence. A bill obtained by Reuters would ban AI from imitating a creator’s “distinctive style,” require disclosure of AI-generated content, and mandate licensing or fair-use limits for training AI on copyrighted works. Platforms that violate the rules could have their local business permits revoked—a sanction that directly threatens Google and other U.S. tech giants operating in the country.
Why It Matters: A New Frontier in AI and Copyright
The proposed overhaul replaces Indonesia’s 2014 copyright statute and covers everything from video games and photography to journalism and film. Under the draft, AI-assisted works qualify for copyright only if they pass a human-involvement test, while fully machine-generated works are excluded. The exact threshold of human input remains undefined—a gap that will shape which AI works gain protection. The bill also requires platforms to pay compensation for aggregating, republishing, or link-previewing news content, as well as for using it to train AI, with payments routed through state-supervised collective management organizations. Hermansyah Siregar, head of Indonesia’s Directorate General of Intellectual Property (DJKI), confirmed the draft’s authenticity, stating, “The development of generative AI has disrupted the copyright framework. If unregulated, it could kill human creation.”
XPLAIN AI’s Analysis: Google’s Pushback and the Music Industry at the Crossroads
Google has emerged as the most vocal critic, warning that “rigid, overbroad mandates would harm local creators, slow innovation, and leave Indonesia as an international outlier, ultimately discouraging the investment needed to drive its digital future.” XPLAIN AI interprets this as a signal that the tech giant sees the bill as a direct threat to its business model, which relies on aggregating content and using data for AI training. For the music industry, the ban on mimicking a creator’s “distinctive style” targets one of the most contested frontiers: voice and style cloning. Startups like Suno and Udio have already faced lawsuits from the RIAA over alleged mass infringement, but Udio has since signed licensing deals with Universal Music Group and Warner Music Group to build a licensed AI music platform. Indonesia, one of Southeast Asia’s largest music markets, could become a testing ground for how licensing models evolve under strict regulation.
Opportunities and Risks: Stakeholder Scenarios
- Google (Alphabet): Faces the risk of permit revocation and mandatory compensation for news content. However, its experience with similar regulations in Australia (News Media Bargaining Code) gives it room to negotiate.
- AI Music Startups (Suno, Udio): The “distinctive style” ban directly constrains voice-cloning technology, but licensed players like Udio could gain a competitive advantage as compliant platforms.
- Record Labels (UMG, WMG): May see increased licensing revenue and reduced costs from fighting unauthorized use, but the ambiguity of “distinctive style” could lead to legal disputes.
- Singapore and Japan: With more permissive AI training regimes, these countries could attract AI investment fleeing Indonesia’s stricter rules.
Counter-Scenarios and Uncertainties
The bill remains a draft and is likely to face significant revisions during legislative debate. The vague definition of “distinctive style” and the unclear human-involvement test invite legal challenges. Indonesia has paired the rewrite with a piracy crackdown, blocking 1,004 pirate sites between January 2025 and May 2026, signaling strong enforcement intent. Yet, global tech lobbying could soften key provisions, especially the permit revocation clause. The outcome will also depend on how Indonesia’s approach contrasts with neighbors like Singapore, which explicitly allows copyrighted works for AI training, including commercial use.
What to Watch Next
Investors should monitor three key indicators: the legislative timeline and amendments in Indonesia’s parliament; negotiations between Google and the Indonesian government, particularly around permit revocation; and the market share of licensed AI platforms like Udio as they sign additional deals with labels. Whether this bill becomes a global template or a regional outlier will be decided in the coming months.
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Sources
- Indonesia’s copyright rewrite would ban AI from imitating creators – and Google’s not a fan. — Music Business Worldwide · News coverage · Mon, 20 Jul 2026 12:56:25 +0000
Written by: XPLAIN AI Editorial Team · Reviewed by: XPLAIN AI Editorial Desk
This content was drafted with AI assistance based on publicly available sources and reviewed under XPLAIN AI's editorial standards.