Korea's IT masterplan falling short

11 Dec 2006

Korea's Ministry of Information and Communication's master plan (IT839), which targets the broad development of IT in the belief that it will raise the country's per capita income to $20,000 a year, is mind-boggling in its vision, breadth, ambition and detailed planning. It is nothing less than a national project to dominate the world of IT through close coordination between government and private industry.

Developed under the guidance of former MIC Minister Chin Daeje, IT839 targets eight services, three infrastructure networks and nine promising sectors.

In putting out such a detailed plan and timetable regarding both development and rollout the MIC put its neck on the line. From the start there have been doubts about how much of it will ever be attainable.

The plan has been facing more criticism inside Korea recently. One outspoken critic is Kim Hee-Jung, an opposition party legislator, who states that the forecasts are poor and that the effect on the economy has been greatly exaggerated.

He has claimed that the MIC originally predicted that IT839 would bring 363 trillion won ($393 billion) in 'trigger- effect' benefits to the economy and then subsequently lowered the figure to 26.3 trillion won - raising serious questions about the credibility of the forecasts.

Kim has also eagerly seized on the slow take-off of several key services such as WiBro and W-CDMA. The MIC stated there would be 704,000 domestic WiBro subs and 1.61 million W-CDMA subs by the end of this year. However, at the end of October, there were only around 50,000 subs for each of these two services. In fact, W-CDMA could claim to have 1.5 million subs but 1.45 million are HSDPA subs using W-CDMA's upgraded capabilities.

Kim states that none of the eight services are progressing close to expectation. He points out that home networking and telecom informatics have failed to achieve even 50% of their original targets. Another case of the MIC's planning he criticizes is the roll out of terrestrial digital TV, which has also hit snags so much that the schedule for terminating analog TV broadcasting in 2010 has had to be delayed until 2015.

Meanwhile, the much-touted BcN services are still nowhere near being launched although at one time these services were supposed to be available to the public in 2005, with an estimated 1.5 million subs by the beginning of 2006.

But setbacks are almost inevitable in the development and deployment of new technologies. In the end, MIC and its IT839 will not be judged by how many deadlines the new services missed and the accuracy of the forecasts but by how much of the plan is finally realized indigenously and to what degree equipment makers and software and contents developers are able to capitalize on this to create successful export products.

September saw IT exports hit a new monthly record of $10 billion. IT839 seems certain to give the Korean IT industry the wherewithal to keep beating records for growth both at home and in export markets.

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