South Korea was ranked second in the 2008 broadband leadership, conducted by the Saïd Business School at Oxford and the University of Oviedo in Spain, and sponsored by Cisco Systems, the telecommunications equipment maker. This year, however, South Korea retakes the top spot in an annual ranking of broadband quality, achieving a broadband penetration rate of 97 percent and quality score of 66 points, followed by Japan with 64 percent and 64 points, respectively.

The study takes into account the download and upload speeds of Internet connections, rather than simply comparing market penetration rates since the quality of connections has grown more important as online services such as IPTV(Internet Protocol television) are expected to become popular in the near future.

The reason why South Korea was ranked second in the 2008 broadband leadership is that the broadband quality wasn’t good compared with its highest broadband penetration rate in the world. However, with the government’s continuous efforts such as the ultra broadband convergence network(UBcN) plan the broadband quality has been significantly improved as you can see below.

The Korea Communications Commission has recently announced that it plans to invest 34 trillion won(roughly 24.6 billion dollars) including investment of about 32.8 trillion won from private sectors in the country’s IT infrastructure. The proposed plan by the KCC aims to meet the expected demand from the future broadcasting and communications services by building the ultra broadband convergence network(UBcN) and replacing the circuit-switched telephone network with an IP telephony network, which will bring the following changes.

The government expects the IT infrastructure investment will create more jobs and boost the country’s economy. Also, it is assumed that a virtuous cycle can be created with investment from private sectors.

According to the KCC, the plan tends to suggest a new vision for the future of IT Korea. It is promised that the government will not take any action to force private sector operators to invest, but it believes that the operators will play big roles in accomplishing the plan being drawn by reflecting their opinions.

SKT has called on the government to reject a plan by KT to merge with its wireless affiliate KTF, saying the merger will create a telecom giant and make it impossible to compete fairly.

From SKT’s point of view:

The KT/KTF merger will make an interactive transition of KT’s dominent position in the fixed-line telephone market into the mobile phone market. Becasue of that, the underlying competition in terms of developing new technologies or products in the telecom market will disappear. Just the competition in marketing will become severe, which means most investment, which is supposed to be made in R&D, is most likely to be used for markeitng purposes.

From KT’s point of view:

As Korean telecom market has been completely saturated, telecom operators are struggling to find a new way of services more appealing to customers, which is in line with the global trend in fixed-mobile convergence. The KT/KTF merger will enable KT to provide various converged products that customers can certainly benefit from at lower price so that the competion in Korean telecom market can lead to cheaper but high-quality services to customers.

We will see how Korea Communications Commission(KCC), the country’s broadcasting and telecommunications regulator, responds to it.