South Korea is a remarkable example of how the opening up of the telecom market is being used to turn around the economic situation. One of the hardest hit countries in the Asian economic crisis, it seems to have risen back and is all set to lead the region in the deployment of broadband access. High-speed Internet access subscriptions in the country tripled last year, and are projected to reach three million by the end of 2000, as per data from the Korea Network Information Centre.

The broadband subscriptions are soaring with the number of broadband Internet users jumping almost 40 percent between May and August 2000. In June 2000, it crossed the 1.5 million mark as per data released by Ministry of Information and Communications (MIC). That represents 12.5 percent of the country's 12 million households, making Korea one of the world's leading broadband Internet markets. According to Bloomberg, over 4,50,000 people signed up for links provided by companies such as Korea Telecom, Hanaro Telecom, and Korea Thrunet, boosting the total number of high-speed Internet subscribers to 1.57 million. In view of the surge, it is predicted that 25 percent of total households will have the latest in Internet communications by the end of 2000, as against 5 percent predicted for US homes.

Policy Initiatives

Hansuk Kim, head of the Management Research Lab at Korea Telecom, points to massive policy initiatives, competition, and the proliferation of online gaming and stock trading as the main driving forces behind the country’s burgeoning demand for broadband. South Korea is believed to have more broadband users than the rest of East Asia (outside Japan) put together. The Internet service charges in Korea are among the lowest for any advanced country and about half of that in Japan, according to the Organization for Economic Co-operation and Development (OECD). The Government initiated an Internet PC project to boost the sales of PCs and notebook computers. It also began certifying and rating commercial and residential building projects on the basis of high-speed Internet access provided by them. This initiative, which allows real estate owners to charge more if they provide broadband services, has resulted in a plethora of partnerships between construction firms, ISPs, and telecom services providers looking to build broadband-ready complexes.

In mid-2000, Korea Telecom, country’s largest telco, headed the pack with 4,91,349 broadband connections, followed by Hanaro Telecom with 4,28,527, of which three-quarters were connected via Asymmetric Digital Subscriber Lines (ADSL). Korea Thrunet, Korea’s first high-speed ISP, claims 3,93,111 customers for its cable modem service. The waiting list for high-speed Internet services—a result of the low cost and overwhelming popularity of broadband—dropped to 6,31,072 subscribers, down 14.8 percent, according to the MIC data.