2005, Bonanza Year for IT Korea
2005, Bonanza Year for IT Korea
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  • 승인 2006.01.01 12:01
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Supported by IT839 strategy, Korea's hi-tech IT industry conquers global markets Korea's representative IT industry nurturing policy IT 839, will be transforming into 'Post IT839' in the New Year, as it evolves into its next stage. Korea's Ministry of Information & Communication (MIC) has reportedly decided to change from new year to a 'Post IT839 policy', reviewing the IT839 policy's performance and boundaries in its 'Strategic Conference for the first half of 2006' held on Dec. 26 in Cheonan.
According to this Post IT839 counterplan, VoIP will be substituted by knowledge-based IT service among eight new services and among three infrastructures, and USN & IPv6 will be united. Instead, software infrastructure is expected to be added. Experts agree that over the past three years, IT839 policy has decisively upgraded Korea's IT level one or two notches. However, critics say that there are some negative aspects to the IT839 policy. One participant at the Conference contended that there must be a definition of IT839 policy from the standpoint of users, and not just from the perspective of business providers. In its 'IT839 strategy assessment and policy direction in coming years', the National Assembly is also concerned that the IT839 policy has a profit model as well as double investment concern. Regarding IT839's negative aspects, participants named unrealistic goal presentations as well as outlook, deepening the existing market's stagnation, such as insufficient objectivity of selections, production structure's inefficiency, profit model absence and double investment concern. However, Korea is equipped with the world's best IT infrastructure, with a subscription rate of mobile communication amounting to 76% of the entire population-with 11. 92 million high-speed Internet subscribers, making it No. 1 in the world, as well as its 31.58 million Internet users, making Korea No. 2 in the world. The year 2005 was a year that saw the first fruits of the government's IT839 policy, which it has been pursuing since last year for the sake of the IT industry's revitalization, as well as new value-added impetus. In reality, WiBro (Wireless Broadband) technology developed by Korea has been adapted as the world standard, and terrestrial wave DMB (digital multimedia broadcasting) began its full-scale broadcasting, while telematics as well as intelligent-model robots etc. and achieved a number of breakthroughs. Rising to the China challenge Recently, a strategic discussion meeting was held in Shanghai, China in the interests of promoting Korea's information and communication technology (ICT) business circle's overseas inroads, as well as Korea's positioning in the global market under the guidance of the Ministry of Information & Communication (MIC). This unprecedented meeting attracted exceptional interest among Korea's IT business circle in that it provided participants with an opportunity to assess IT Korea's global phase according to China's rapid emergence and adopt more realistic approaches to recent policy issues such as consolidating the system dimension's support system for export activation which showed signs of slowing down in the first half of the year. In particular, the background that this meeting was held in Shanghai, the iconic city symbolizing the growth of China, was an opportunity to experience first-hand the actual meteoric rise of China, which is Korea's largest ICT-associated trade partner, as well as the largest competing country of IT Korea hub strategy. The speed and performance of growth in China is astonishing and especially in the ICT field, China has emerged as a factory of the world on the basis of the country's 1.3 billion population in addition to growing into one of the world's three largest logistics strongholds as the three largest global aviation special forwarding companies such as DHL, FedEx, and UPS, all selected China as their Asia hub. MIC Minister Chin explained: "In addition to infrastructure competitiveness regarding manufacturing as well as logistics, China is proactively launching overseas investment inducement too by leveraging corporate groundwork with technology power. Needless to say their ICT-associated corporate competitiveness is being beefed up considerably." According to him, China is rapidly emerging as a significant threat to Korea, which aims to be a global test bed in the ICT industry field and a hub in Northeast Asia. Director-General Kang Dai-young of the ICT Cooperation Bureau, MIC, who chaired this conference cautioned: "China's superior IT companies are proactively acquiring overseas companies on the basis of their substantial foreign exchange reserves," adding that he was impressed by the progress of China's cutting-edge industry, which is developing on an enormous scale and speed in the fields of electronics, computer and communication equipment. Issues discussed through this conference were that Korea has to move in the direction of innovation, sharing collaboration and competition, not competing as an unconditional enemy of China. With this as an impetus, participants were of the same opinion in that Korea should seek win-win cooperation with China in the IT field, plus utilizing China's emergence as a new growth opportunity for Korea's IT industry by enhancing its understanding of China's IT industry. IT industry growth engines IT exports have grown to be a key industry of Korea both nominally and virtually just 10 years after Korea began IT exports in earnest in the 1990s. IT exports as of November 2005 reached US$71.7 bil., despite global IT business's sluggishness, won appreciation and high oil prices. In an 'IT 839 Globalization Strategic Conference' held under the supervision of ICA (International Cooperation Agency for Korea IT) and KAIT (Korea Association of Information & Telecommunication) on Dec. 7, 2005, MIC vice minister Rho Jun-hyong, has committed to the Ministry's support for domestic IT companies' overseas marketing efforts, particularly for DMB, WiBro, D-TV, and Telematics, which have been the most successful recently among the IT 839 items. Since 2004, the government has been pursuing the so-called 'IT839 Strategy' to ensure the IT industry's global competitiveness, as well as creating new value-added exports. In other words, by promoting service creation, infrastructure construction, and technology development in a seamless way, the government is to secure a pre-circulation structure for the IT industry and pursue the IT industry's growth engines. Such efforts by the government are certainly reaping benefits in terms of WiBro, DMB and Telematics, not to mention semiconductors, mobile communication terminals, and TFT-LCD. In particular, 2005 was the first year when terrestrial wave DMB began its full-scale broadcasting as well as overseas marketing inroad efforts started to bear fruit. First of all, the government is activating eight cutting-edge IT services as part of its 'IT 839' policy to reinforce the information communication service industry's competitiveness, plus fostering a convenient and safe communication use environment by improving various legal measures, together with proactively meeting the challenges of the convergence era, such as communication/broadcasting fusion. Targeting innovative ICS By introducing and implementing these eight information communication services, the government has prepared the groundwork for launching five new services, namely WiBro, DMB, Home networks, Telematics, and RFID (Radio Frequency Identification), in addition to activating three existing services, namely W-CDMA, DTV, and VoIP (Voice over Internet Protocol). In the case of WiBro, service users can access high-speed Internet cheaply and freely in any place and at any time, plus on the move as well. The government selected its business providers in January 2005 and is scheduled to provide users with personalized good quality contents inexpensively and conveniently by completing commercialization of the WiBro system and terminal development by the end of 2005. With regard to satellite DMB, a broadcasting service that offers a variety of contents such as music and video through cellular TV and PDA on the move, it began commercial service in May 2005. Satellite DMB is planning to prepare the groundwork for launching WiBro service by securing up to 300,000 subscribers by the end of 2005 and terrestrial DMB also was slated to commence full-scale broadcasting within 2005, with business provider selection and a TV broadcasting station permission. Concerning home networks, a service which allows homes to transform into convenient information living spaces by linking all information in the household's electric equipment through a home network, a lready, 1,300 home network model households have been constructed and convertible tests are being done through constructing common test environments for home network service. In the case of telematics, a car multimedia service which offers traffic guidance, as well as Infortainment, by using location information and wireless communication network, Jeju, (an international free city), has a telematics model city project under way and is expected to provide users with diverse model services such as travel, traffic, Jeju culture, leisure facilities and so forth. In the case of RFID, a service that offers information as well as surrounding environment information by attaching electronic tags to all objects and by using wireless communication technology, the government is promoting model projects, with priority given to public fields with significant success potential and ripple effects for the purpose of initial market creation and private utilization facilitation. Regarding W-CDMA, an asynchronous system IMT-2000 service in which highspeed screen and data service are possible, not to mention voice service by using 2GHz band's frequency, the government is striving to allow the service to be launched as soon as possible by constructing a WCDMA network applying HSDPA technology for the sake of a differentiation with established CDMA service in 23 cities last year, and 84 cities in 2006, to provide nationwide service and by introducing a differentiated charge system. In the case of VoIP, the government has vested VoIP discernment number (070) separately in the interests of communication market's competition facilitation as well as enhancing convenience for the people and has authorized business providers in 2005. In the case of D-TV service too, the government is planning to construct a nationwide D-TV broadcasting network by 2006 and is scheduled to complete terrestrial-wave broadcasting's digitalization by 2010 as planned. MIC invests in core technology development Concerning infrastructure construction for three cutting-edge technologies, namely BcN, USN (Ubiquitous Sensor Network), and IPv6, an axis of the socalled IT839 strategy, the government is planning to forge an information communication service use environment of the highest level in the world, providing 20 million subscribers with broadband service of 50~100Mbps notch by 2010. In 2005, MIC was planning to design as well as construct a BcN model network for 1,350 households in six metropolitan cities, including Seoul, Busan and Gwangju. For reference, BcN is a nextgeneration network in which users can use quality-guarantee-model broadband multimedia service that fused communication, broadcasting, and Internet, safely and seamlessly, anytime, and anywhere. In the case of RFID/USN demand activation, MIC is planning to nurture RFID/USN as a promising industry of the future and to universalize u-Life in actual life by 2010 through demand activation associated with U-IT hub construction. To promote demand for RFID/USN, MIC is planning to nurture RFID/USN as a promising industry of the future and to universalize u-Life in actual life by 2010 through demand activation associated with U-IT hub construction. The Ministry, which invested roughly 27.5 billion won (approx. $27 million) in 2005 for core technology development, and standardization propulsion etc. in this field, has driven public sector service expansion in 2005, as it has great success potential, by investing 4 billion won (approx. $39 million). Regarding the dissemination of Ipv6, MIC is designing to solve the problem of Internet address resource shortages fundamentally by converting to an all-Ipv6 foundation by 2010 and to nurture the next-generation Internet industry as well as service. Currently, Ipv4 address resources, which remain at 4.3 billion, are expected to be depleted in about 2006, whereas Ipv6 address resources whose quality and security level are excellent, are infinite. Following Ipv6 model network enlargement construction to 113 institutions plus offering Ipv6-based 10 model services etc. in 2004, MIC has enforced VoIPv6 model service for public institutions in addition to providing Ipv6- based WiBro model service and applying Ipv6 experimentally to home network model households in 2005. For this area, the government has invested roughly 12.7 billion won (approx. $12.50 million) in 2005 including 8.5 billion won for core technology development, 3 billion won for Ipv6 activation, and 1.2 billion won for address resources management/ authentication. In the case of nine new growth engines, such as IT SoC, next-generation PC, imbedded S/W, DC & S/W solution, intelligent-model service robots, and so forth, by contrast, so far private corresponding investment appeared to be very insufficient even though MIC invests huge sums with an aim for the nation to achieve the era of national income of $20,000 per capita earlier. According to information MIC recently provided to the National Assembly, governmental funds account for 80% of the total 474.7 billion won (approx. $460 million), consisting of governmental invested expenses of 377.8 billion won and private invest expenses of 96.9 billion won. Accordingly, private-initiative commercial investment needs to be attracted more briskly. Clearly, the engine needed to accomplish $20,000 GDP per capita by revitalizing the Korean economy, which has maintained its national income at the $10,000 level over 8 years, has no alternative but to seek the solution in IT and science technology. In this regard, even more interest and expectations are being directed toward the 'IT 839 Strategy' to claim the 21st century miracle. The kernel of the so-called 'IT 839 Strategy' is to maximize the IT industry's 'value chain effect, aiming to accomplish IT annual production of 380 trillion won, and export $110 billion by the forthcoming 2007 through organic connection between eight new services, three infrastructure developments and nine new growth engines. In other words, eight services, three infrastructure developments, and nine new growth engines, have to create synergy effects through mutual close relationships under a common denominator, called the 'Ubiquitous Age'. In addition to such economic ripple effects which lead to expect production induction benefits of 380 trillion won in about 2007, an important value of IT 839 Strategy lies in that it presents a vision of a full-scale u-Korea era; that is, a conversion from the knowledge-based society to an intelligent-based society. Namely, MIC is to develop a knowledge-based society centering on Internet and mobile communication into an "intelligenization" digital society, such as digital home, digital enterprise, and e- Government, by leveraging IT839 strategy.

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