Fusion of Old Paradigms
Fusion of Old Paradigms
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  • 승인 2007.05.14 15:35
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The Unified Broadcasting- Communication Promotion Committee finally decided several majority opinions regarding important issues of IPTV through a vote on the 5th day of their meeting, so network service providers can penetrate into the IPTV business without any restriction, having the nation as their business areas.

Through this decision it became possible to check majority opinions and minority opinions regarding hot issues such as characteristics of the service, licensing types and regulations, but criticism that it didn't consider any connections among the issues is being raised.

The Committee closed the discussions of IPTV in the general meeting held on the 5th day, leaving the bill of the installation of the Broadcasting and Communication Committee, which has been continuously argued, and the method of the introduction of IPTV unsolved.

According to the parties concerned about the Committee, in relation to the characteristics of IPTV, the committeemen in the general meeting selected the stipulation that "broadcasting is the major service of IPTV, and communication is the minor service" as a majority opinion. In addition, it decided the Broadcasting Committee's insistence, Classification 3, as a majority opinion, judging broadcasting providers as the appropriate providers of IPTV.

In relation to the licensing type for service providers, it selected a license system for real-time broadcasting and Video on Demand (VOD), and decided the regulation of the market share restricted to 33% including analog broadcasting, cable TV, satellite broadcasting and IPTV as a majority opinion.

In addition, it stipulated the obligation of equivalent approach to network was the responsibility of all the service providers in the case of business licenses, and in relation to the restriction in advancement it decided it as a majority opinion not to give any restriction to large companies' and dominant communication service providers' advancement into the service. It also decided it as a majority opinion that the share limitation for daily newspapers and news communication is 49% and that the standards of the Broadcasting Law are applied to foreign capital, also restricted to 49%.

In relation to the article that makes activation of contents compulsory, the Committee decided it as a majority opinion that criteria for examination are stipulated, some conditions are given in case license recommendation is made, and financial resources for the development of contents are prepared. In relation to this, the parties concerned about the Ministry of Culture said: "The opinion of the Ministry of Culture that the contents for new media including IPTV are short has been accepted and the committeemen followed the actuality that the local-made contents business should be promoted in preparation for Korea-America FTA."

However, the Committee decided to report the bill for IPTV introduction to the Prime Minster, leaving whether to make it through the Broadcasting Law or the Unified Service Law or not undecided yet, and it selected it as a majority opinion to handle the bill of the installation of the committee and the bill of IPTV together.

Making new law

The camp of broadcasting and the camp of communication are measuring oneself against another in strength with the introduction of IPTV ahead. The Ministry of Information and Communication insists that IPTV should be regarded as a united service, not either broadcasting or communication, and it should be handled based on a third special law, and the Broadcasting Committee insists on amending the Broadcasting Law and regulating it according to the Broadcasting Law.

Then what kind of service is IPTV For what both the parties of broadcasting and communication are having a struggle for the leadership IPTV means to provide high-resolution TV broadcasting and two-way data service through high-speed Internet network.

Once IPTV gets started, consumers can use various services on TV such as watching a video on demand, e-commerce, videoconferencing, on-line games, and chatting. Especially, the age of Triple Play Services, multimedia services composed of Internet, phone and broadcasting will be open, which will become a foundation for the next generation broadcasting and communication unification service.

Network service providers that are facing a restriction in their growth due to saturation of the voice and Internet service market regard it as a blue ocean.

IPTV growth prospects

According to the Electronics and Telecommunications Research Institute (ETRI), on the assumption of commercialization in 2006, the number of IPTV subscribers will increase by an annual average of 34.4% so it will reach 3,950,000 people in 2012 and accordingly, the monthly sales turnover of the service providers in 2012 will reach one trillion won, or approximately one billion US dollars.

ETRI expects that IPTV will have big influence on industrial activation, making the effect of 12.9 trillion production and the effect of 73,000 people employment for 7 years from the next year to 2012. Accordingly, KT, Hanaro Telecom, and Dacom are promoting IPTV.

The potential explosive power of IPTV aroused a conflict between the broadcasting camp and the communication camp. Whether the identity of IPTV is stipulated as broadcasting or communication can make a big change in the position of the political party, and especially, the broadcasting circle recognizes IPTV as an alterative to cable TV so it intends to actively prevent the introduction of IPTV.

The cable TV business tells that IPTV has a feature of broadcasting that transmits TV broadcasting or data broadcasting contents in the air and it uses wired transmission facilities and transmits multi numbers of programs at the same time so it is the absolutely same service as digital cable TV. Therefore, it worries that if KT penetrates into the IPTV service, the SO market will collapse.

On the other hand, the communication circle including the Ministry of Information and Communication insists that IPTV, in which two-way services are available, is a new service different from the existing cable TV so it should be offered as an additional communication service or be regulated as a third special law.

Because both the parties couldn't reach any agreement, Yoo Seung-eui, a Uri Party national assemblyman belonging to the Science, Technology, Information, and Communication Committee, proposed an Information Media Business Law that regulates IPTV as a third field, not either broadcasting or communication.

In order to cope with the Information Media Business Law, the broadcasting circle proposed an Amendment of the Broadcasting Law through Kim Jae-hong, also a Uri Party national assemblyman belonging to the Culture & Tourism Committee that IPTV should be under the same regulation as SO.

However, no agreement is made in the governing party and the discussion of the introduction of IPTV in the national assembly will be carried forward to the next year. Different ideas among the national assembly, the political parties, and the service providers have not been adjusted.

Lee Young-hee, Director of KT Media Center, said: "We will start the exemplary service after going through the agreement among the Ministry of Information and Communication, the Broadcasting Committee, and other political institutions so the exemplary service of IPTV will be progressed next year."

The Committee decided to introduce IPTV so both the parties of communication and broadcasting are busy calculating their profit or loss.

Separately from the service providers' calculation of profit and loss, the discussion of IPTV introduction has complicated possibility in that it is under the same destiny as the bill of the installation of the Broadcasting and Communication Committee that was carried forward to the National Assembly in the beginning of this year.

The government takes it as a principle to handle the bill of installation of the committee and the bill of IPTV introduction together. That is, it will make either the bill of installation of the committee or the bill of IPTV introduction passed, leaving the other alive.

However, in relation to the bill of the committee installation or the bill of IPTV legislation, the relevant ministries and offices, and the ruling and the opposition party have different ideas so as the political situation of the presidential election is coming, passing the two bills in the National Assembly will be as much in the dark as ever.

Worldwide phenomenon

With the age of broadcasting and communication unification coming in, the introduction of IPTV in the world is increasing. FastWeb of Italy obtained 160,000 IPTV subscribers in the end of 2004, which is over 40% of the FastWeb broadband subscribers (370,000 people).

France Telecom started the service in Lion and Paris, and Free is providing the IPTV service in 22 large cities. PCCW, a network provider of Hong Kong started the service in August 2003 in order to keep the market share of DSL and to increase ARPU (average revenue per user), and in the end of 2004, it obtained 420,000 subscribers.

In North America, telephone providers in small and middle-sized areas of America and Canada started the IPTV service, and BellSouth, Qwest, SBC, and Verizon are providing the service in combination of the service of satellite broadcasting providers such as EchooStar and DirecTV. In Japan, Soft Bank and KDDI started the service. At present, many countries run into the IPTV service.

The number of IPTV subscribers in the world was 1,900,000 in 2004, which will increase to 25,000,000 in 2008, making a rapid growth of annual average 79%. Under this circumstance, Korean IPTV should be progressed as soon as possible, and by removing the restriction given to network service providers' advancement into IPTV business, a concrete direction for unification of broadcasting and communication is decided.


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