7/29/2019 IDG Connect Dan Swinhoe (Asia)- Retrospective_ How IT Boomed in Korea

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Dan Swinhoe (Asia)- Retrospective: How IT Boomed in Korea

Today, South Korea is known as one of the most hi-tech nations in the world. It has advanced infrastructure, is

emb racing smart devices and is even look ing towards the future with intelligent urban areas known as U-cities,

which should be completed in the next couple ofyears. It also claim s masses of the world's various IT mark ets;

capturing 27.5% of the mob ile phone m arket, 37.8% of TV, 51.7% of memory, and 52.9% of display panel market

shares.

But this wasn't always the case. Shortly before the new millennium, the Korean economy experienced its worst

recession since the Korean War. However in a couple of years, not only had the economy recovered, but was in

better shape than ever. And this almost entirely down to the IT sector. Throughout the recession period the IT

sector continued to grow rapidly, spurredby the development of a number of new technologies including mob ile

hones, thin film transistor-liquidity crystal displays (TFT-LCD), Internet-related industries, broadband, digital-TV,

and wireless Internet', along with traditional sales of PCs. Within two years, from 1997 to 1999, mobile phone

subscribers tripled, and between 1998 and 2000, internet users multiplied five-fold. In the space of a few years,

the country went from average to one of the biggest consumes of digital technology in the world.

This shift was helped by a lot offactors. Before the economic problems, competition was scarce and electronics

were expensive, but an array of new companies pushed down prices almost overnight, fostering growth. The

opulation's high levels of urbaniz ation (70% of South Koreans live in its seven largest cities) mean it's easy for

the majority of people to access the internet, wireless services and places to purchase technology. Computers are

engrained into the youth culture; many are avid internet gamers andbloggers, and those that couldn't afford

computers of their own often frequented internet cafes. The high levels of literacy and quality education were also

factors.

Becoming specialists in hardware has been a massive plus, and has been a constantly growing sector for nearly

over a decade, and still is today. Some might argue that the country is over-reliant on hardware (84% of the total IT

industry), and in this cloud-driven world software development is the future, but the reality is that there will always

be a place for hardware, and as devices become ever-more powerful and complicated countries with specialisms

in creating them will benefit even more.

Of course government assistance has also had a large hand in the tech-based direction that Korea has been

taking. Laws surrounding IT were revised, including intellectual copyright, and back in 1999 the Cyber Korea 21'

roject was unveiled. It promised to spend $24.8 bill ion b y 2002 on upgrading I T infrastructure, providing training

rograms, and establish legal frameworks to vitalize e-commerce and the IT industry. The government

encouraged private investments by promising to b uild a b ackbone network for high-speed communications

ublic funds.

Being early adopters of technology was a big factor. In 1995, South Korea had less than one internet user per 100

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7/29/2019 IDG Connect Dan Swinhoe (Asia)- Retrospective_ How IT Boomed in Korea

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inhabitants. In 1999, it surpassed the developed nation average and by the end of 2002 was the world's fifth

largest internet market, with 26 m illion users. This year Korea b ecame the first country to reach 100% b roadband,

up from 89% last year. But the country's continued investment has been a big factor in its on-going status as a

world leader. In 2009 with an eye on superfast fiber-optics, $152.3 billion was spend to develop IT convergence

applications, software, key IT solutions, communications and the internet over the following five years. By the end

of the year the Fiber-optic subscriber b ase had already reached9.23 million. That figure has continued to rise to

over 55% today.

Smartphone penetration has hit50%, equaling the lik es of Australia, UK, Sweden and b eating the US. But Korea

is the clear leader when it comes to mobile broadb andsubscriptions, and today, while the UK is getting its first4G

enabled networks, Korea already has a penetration rate of17% and rising.

There isn't a magic bullet that shot South Korea to the top of the IT food chain. Rather, it was a range of factors;cultural, demographical, and governmental, that all gelled together. What is most impressive however, is that it is

still a world leader, thanks to constantly renewing the desire to stay where it is.

By Dan Swinhoe, Editorial Assistant, IDG Connect

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