Telecommunications In Korea Essay Research Paper INTRODUCTIONTelecommunications — страница 10

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and ETRI. Through these entities, research and development was made possible. To introduce progress and enhance the telecommunication infrastructure, the Korean government encouraged competition. In this regard, the MOC intended to introduce fair competitive policy at various levels from the early 1990s except for local voice services which will still be monopolized by KT. As a first step, KT for the first time began to compete with DACOM to provide international telephone services from December 1991. The MOC is planning to license other domestic and foreign companies to enter the telecommunication competition. On the basis of the new competition policy, a variety to low-cost services are expected to be developed and provided; small and medium-sized companies will be promoted;

and various companies including the government will participate in regional and international organizations through which they can extend cooperation among members. Competition will add to lower-cost and higher quality telecommunications products and services. The government also restructured its Ministry of Communication (MOC) to mainly monitor and guide the various telecommunications actors as well as setting an overseeing telecommunications policies. Its responsibilities of operating day-to-day telecommunications business was delegated to separate entities. ETRI has gone ahead with globalization of research and development. It has expanded and consolidated technological cooperative relations with both developed and developing countries and established international joint

research programs. Liberalization has enabled KT to promote the domestic telecommunications industry by making maximum use of its procurement power. For example, KT has been installing facilities at the rate of 1 million telephone lines annually since 1980, producing a current total of about 17 million lines. This investment has enabled KT to provide a stable market for local industries, and to help them upgrade their product quality by implementing such measures as demand forecasting system and quality assurance system. All in all, the implementation of its industrial policy reflects Korea’s determination to achieve a suitable mix of high-quality labor-intensive traditional industries and skills-intensive heavy and chemical industries. Such a mix is regarded as allowing Korea

to prosper in the 1990’s among the developed or industrialized countries that are moving into high-tech industry and information-intensive activities. The Telephone Bond Law was enacted in December 1961 in order to raise the capital required for expanding and improving telecommunications facilities (MOC 143). This law was replaced by the Provisional Law for Developing Public Telecommunications Facilities in December 1979, which in turn was repealed in January 1988 when the demand for basic telecommunications facilities was deemed satisfies. Changing policies and infrastructures go hand in hand with a set of regulatory reforms in the field of telecommunications. The concept of deregulation or liberalization is based on the view that, in a free market, exchange between

individuals will lead to an efficient or optimal allocation of resources. E. Arnold and K. Guy state “government intervention – whether through regulations, policies or R & D (research and development) investments – seems to be a rule rather than the exception in the processes of liberalization, privatizations and deregulation.” Thus, they state that the participation of the government is necessary to liberalize the telecommunication industry. J. Browett agrees with Arnold and Guy stating that changes in telecommunications in Korea can be said to have been initiated and implemented by the government. An illustration given was that a policy was adopted by the government to upgrade the priority of investment in telecommunications during the 5th Five-Year Economic

Development Plan in 1982 to 1986. As a result, telecommunciations investment was increased from 3% of total national fixed assets in the 1970s to 7% in the 1980s. The Telecommunications Basic Law was largely revised to encourage all parties concerned to invest in research and development into more sophisticated technologies and more relevant socioeconomic policies in the highly competitive telecommunications environment. KT has reinvested more than 50% of its total profits in the development of telecommunications facilities. After being privatized, common carriers and operators in several countries have tended to increase rather than decrease their tariffs to provide high-quality services, which require financing of high-tech facilities. However, it is also worth noting that