Adam Thierer

Korean Recipe for Broadband Success

Tom Hazlett has a nice piece on page A12 of the Wall Street Journal today explaining why South Korea is kicking everyone else’s butt when it comes to broadband connectivity and speed. Surprise, surprise, it comes down to their reliance on facilities-based competition instead of regulatory micromanagement. Hazlett notes that “Korea’s policy has proved a smashing success… (because) the government ended regulation of advanced telecom applications. The result: While competitors largely avoided (regulated) voice services, they invested billions to create new (unregulated) high-speed Internet networks. The broadband technologies unleashed by telecom rivals forced (Korea Telecom) to modernize its network, which now serves just half of the high-speed market.”

As a result, 78 percent of Koreans now have broadband access, the highest penetration rate in the world and double that of the U.S.

The bottom line: “forced access” infrastructure sharing regulation cannot deliver the goods. Only true, facilities-based competition, brought on by comprehensive market liberalization, will bring about the investment and innovation this country so desperately needs. John Wohlstetter of the Discovery Institute has come to the same conclusion in a recent piece.

August 26, 2004 | Comments |

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    The latest issue of BusinessWeek (September 6th) has a small piece on page 88 entitled "Behind the Broadband." The article lays some blame for the U.S. being behind other countries in terms of broadband penetration on a lack of competition. The recent court decisions to rid the Baby Bells of the forced access burden is cited as a negative. My reason for posting is that the authors cite the Korean experience, which according to them, was increased broadband penetration due to forcing "the incumbent phone companies to let startups use their networks at reasonable, government-set prices."

    This assertion sort of contradicts Tom Hazlett's piece in the WSJ. I enjoyed the Hazlett piece but now have reservations about citing it. Comments or clarification?

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