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Socio-Economic Effects and Policy Issues of Korea Broadband Internet : Socio-Economic Effects and Policy Issues of Korea Broadband Internet June 5, 2002 Dr. Yoon, Byeong-Nam National Computerization Agency Ministry of Information and Communication Republic of Korea


Abstract : Abstract In the 21st Century, experts foresee a knowledge based society. There are currently 500 million internet users worldwide. Networked knowledge and information has become a powerful tool in enhancing international competitiveness. The construction of the broadband infrastructure is one of the top priority policy in most country. The Korean government strongly promoted informatization and the construction of the broadband infrastructure. As a result Korea has the largest broadband penetration rate in the world. The broadband internet is creating new markets and cultures. This presentation will discuss: The current status of Korea’s active broadband services. Policy issues to promote more broadband services. Socio-economic effects of the broadband services.


Slide3 : Introduction


Infocommunication Status : Infocommunication Status ( Population : 47million ) 0 5 10 15 20 25 30 1997 1998 1999 2000 2001 Telephone Mobile Internet 24 30 (in millions) 29 24


Broadband Internet Household : Broadband Internet Household [ Unit : million ]


Internet Usage at Home : Internet Usage at Home [ Unit : hours ] Monthly Average Access Time in Each Country


Revenue of Telecom Services : Revenue of Telecom Services (USD billion)


Slide8 : Digital Society and Policy Issues


National Grand IT Projects : National Grand IT Projects National Grand IT Projects since 1980 TDX switch system in 1984 CDMA mobile system in 1996 National Basic Information System in 1996 ATM Broadband Internet System in 2000 Cyber Korea 21 (1999-2002) e-Korea Vision 2006 (2002-2006)


National Knowledge Management Project : National Knowledge Management Project A consolidated national knowledge system through digitalization of knowledge information was needed. “Information Knowledge Database Expansion and Consolidation System Construction Plan (1999∼2003)” Act of Knowledge Resources Management (Jan. 2001) Digitalize the data in 5 fields: Education, history, science & technology, culture, telecommunication Korea Institute of Science and Technology Information digitalized 9 DB (2000) Ministry Of Culture & Tourism digitalized 15 DB (2001) Korean Education Research & Information Service digitalized 14 major DB, $19 million US (2002)


National Knowledge Management Project : National Knowledge Management Project


Cyber University : Cyber University < Cyber University > [Unit : Thousand persons ] < Cyber University Students >


Cyber University : Cyber University The internet manages all the universities administrative services. Tests, final exams, assignments the requirements for a degree are no different than off-line universities. There was a 170% increase in the number of registered students in 2002 totaling 16,700 students.


Work at Home : Work at Home The Samsung SDS introduced “Work at Home” as of March, 2002 KT introduced “Work at Home” for a Telephone directory Operator 114 since 1998 Korean Airline introduced “Work at Home” for the disabled flight reservation customer representative since 2001 Seoul Metropolitan Government is planning to introduce a trial "Work at Home” as of May 2002 Established laws governing telecommuting on March, 2001 10% of working employees have more than 2 jobs and one of them are conducted at home (Source : Jobkorea, survey)


Growth of Cyber Community : Growth of Cyber Community


Political Cyber Community : Political Cyber Community During the Presidential candidate elections, Internet votes were counted after the security identification. April 18 - 27, 2002 2.5% of the votes More than 81% of Congressmen have a personal homepage. 61.5% of Congressmen have planned or have used the Internet as means of raising political funds 84% of Netizens feel that the internet is an effective way to express one’s political opinions.


Policy against Side Effect : Policy against Side Effect The Telecommunications Ethics Committee was formed to regulate Internet contents. Suicide site, Abusive materials, Sexual contents, etc. Information Utilization Protective Division in Ministry of Information and Communication Policy of private information protection, prevention of unwholesome information distribution


Internet Newspapers : Internet Newspapers [Unit : Million persons ] As of Nov. 2001


Advent of Prosumers : Advent of Prosumers The netizens are no longer passive culture consumers but are active culture producers. Through the development of computer programs, it is easier for users to publish books, produce short films, write music, etc. More opportunities are available to be involved as a “Culture Producer” There is an increase of internet broadcasts and DJ’s through internet chat sites. “Chollian (ISP, www.chollian.net)” has created a personal broadcasting center (www.inlive.com) for netizens


e-Market Place : e-Market Place Number of e-MP


Growth of the e-Commerce Market : Growth of the e-Commerce Market [ Unit : Billion USD ] ※ Source : Ministry of Information and Communication


Ubiquitous Internet Stock Trading : Ubiquitous Internet Stock Trading Stocks can be traded via cellphone and PDA anywhere. Customized stock trading alerts the investor when the stock reaches a certain price.


Growth of the Internet Stock Exchange : Growth of the Internet Stock Exchange The total transactions in 2001 was $1.2 trillion US [ Unit : % ] ※ Source : Ministry of Information and Communication


Growth of Internet Banking Users : Growth of Internet Banking Users Korea’s Population : 47 million [ Unit : millions ] ※ Source : Ministry of Information and Communication


Summary of e-Korea : Summary of e-Korea


Broadband Services and Contents : Broadband Services and Contents


Advanced Internet Service Policy : Advanced Internet Service Policy The results of Cyber Korea 21: Broadband penetration is over 8 million households Multimedia contents (Movie, Games, Video, Audio, etc.) are actively use. Free of charge because of undependable service. e-government, e-commerce, and e-procurement More security is needed. To guarantee the QoS and Security, e-Korea vision 2006 ATM MPLS technology


Certified Digital Signature Users : Certified Digital Signature Users [ Unit : million users]


Public Key Infrastructure : Public Key Infrastructure Digital Signature Act (Feb. 1999) The Certification Authority supports a secure e-Commerce and e-Government environment. PKI(Public Key Infrastructure) was established to promote a safe and secure environment for networked services nationwide. National procurement, e-education, e-civil services, etc. The government leads the public to use digital certificates and expects that the total number of users will reach 10 million by the year 2002.


Small Business Network Project : Small Business Network Project Personal users have affordable access to the internet via services like ADSL, cable modem, etc. On the other hand, most small-mid sized businesses can not afford the expensive leased line service. Therefore, the government established Small Business Network Project on December 2001 The government supported 2.9 million small-mid sized companies through IT education, e-business services and hardware. In the year 2002, $15 million will be invested into the project.


Productive Business Management : Productive Business Management


Internet Advertisement Market : Internet Advertisement Market [ Unit : millions Users]


Internet Advertising : Internet Advertising “e-Commerce Consumer Protection Act” on September 2000. Standards for internet shopping malls. Protection of privacy. Regulations regarding internet advertising must receive customers approval for emails must be less than 30KB Inform consumers on the risks and hazards on the internet. Refund policies


Growth of the Monternet User : Growth of the Monternet User [ Unit : millions users]


Growth of the Monternet User : Growth of the Monternet User [ Unit : millions USD] < Revenue for the wireless internet > [ Unit : millions USD] < Profit from the contents services >


Slide36 : Digital Economy


Production of the IT Industry : Production of the IT Industry The production of IT increased from 58.1 billion USD in 1997 to 109.9 billion USD in 2000 and growth in production is expected for the time being. (USD billion) Note : Throughout this statistical profile, we use the current exchange rate 1,300Won/USD Source : Korea Association of Information and Telecommunication


Share of the IT Industry in GDP : Share of the IT Industry in GDP The IT industry has continued to have a growing share of the GDP from 8.6% in 1997 to 13.0% in 2000. Source : Korea Information Society Development Institute


Contribution Rate of IT to GDP : Contribution Rate of IT to GDP The IT industry contributed to economic growth(GDP) with a mere 4.5% in 1990, which drastically increased to 50.5% in 2000. Source : Bank of Korea Note : contribution rate = (the real amount of value added increase from IT industry) / (the real amount of GDP increase)


ADSL Related Export Status : ADSL Related Export Status [ Unit : millions USD ] ※ Source : Ministry of Information and Communication


Slide41 : Thank You