South Korea and Ireland
Great article here about the future of the internet — in South Korea. Everyone's a netizen. Everyone has cheap broadband. Nine out of ten 20-something Koreans are part of Cyworld. Online activists helped elect the President, and the President gives his first interview to OhMyNews.
South Korea made the decision ten years ago to invest in high-speed (competitive) internet access and subsidize cheap PCs — as a result, they have just about the highest broadband penetration in the world. Not only has the dream come true, but economic growth comes attached.
Meanwhile, someone sent me a Wall Street Journal Europe article about VCs carving up an Irish telephone company to treat transport like a utility. The big guys can watch the model and then think about selling their own networks to raise some cash.
Ireland is a model proving ground to attempt a split, says Robert Topfer, head of corporate finance at Babcock & Brown. Because Ireland has a relatively small population of about four million spread out over the island, it would be too expensive for any competitor to build a network reaching all the homes and offices, leaving Eircom with a monopoly. The company must share the network by leasing access to competitors and others such as Internet providers, but the system for doing that is clumsy and loses money and is a headache for regulators.
“We share, but we share begrudgingly,” Mr. Topfer says. The answer, he says, is to hive off the network and regulate it like a utility. For the regulator, such an outcome would be “nirvana,” he adds.
So the money guys see the advantage in separation.
As I've mentioned in the past, the EU telecommunications regulator keeps talking about separation and suggesting that taking this step would help the competitive picture all over Europe.
There are good ideas all over the place outside the borders of the U.S. — all we need now is bravery, and we'll be able to catch up. I hope.
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I admire, but don't share, your optimism.
The trend from my perspective appears to be one of protecting incumbent interests at the expense of the public good and, frankly, common sense. One doesn't need a crystal ball to see the future. J. Scalia characterized well the current situation when he said in his BrandX dissent: “This is a wonderful illustration of how an experienced agency [the FCC] can (with some assistance from credulous courts) turn statutory constraints into bureaucratic discretions. . . . not by changing the law . . . but by reserving the right to change the facts.” or, in other words, “Badges? We don' need no stinkin' badges!”
In a world where courts facilitate such agency discretion and the self-same agency sets itself the task of weakening an already atrophied Fourth estate by proposing to allow further media consolidation . . . well, I'd say the writing was on the wall, but finding walls to write on is only getting harder.
Moreover, I'd hazard to guess we'll try to export our models before we ever get around to adopting models from abroad. Like climate change, it won't be a question of mitigating the loss of our broadband competitiveness, but adapting to our deficient position . . . after all, isn't that exactly what tiering “services” IS? i.e. isn't that exactly what telcos are proposing?
The OECD puts us right behind Belgium in terms of broadband penetration (those Jacques Brel MP3s are moving fast, well, at least fast-er) and one look at FTTH penetration ought to make even the most optimistic among us falter.
A short addendum to the idea of exporting US regulatory policy.
Ofcom (the UK uber-regulator) solicited a “public discussion” on next generation networks (yesterday 11/24) including these little gem-like bullet points on “Investment Incentives and Net Neutrality”:
Ahhh, the pursuit of unbiased, evidence-based policy making at its finest . . .