BROADBAND MARKET DEVELOPMENT IN THE REPUBLIC OF KOREA
and by the end of 2008, the number of fiber-based subscribers was 6.6 million, giving FTTH 43 percent of the country’s broadband connections. Demand facilitation has also been a key part of Korea’s approach. In the early stages, the main services driving the adoption of broadband were online stock trading, education services, and games. As uptake increased, there was a move toward more interactive services such as shopping, e-mail, and participation in cyber communities. Today, the focus is on music downloads and gaming. E-government, e-commerce, and e-learning are also important drivers of high broadband adoption in Korea. ICT plays a significant role in education in Korea. EDUNET, one of the country’s online educational services, was introduced in 1996. By 2008, it had 5.8 million members. The government has also taken steps to increase the global competitiveness of domestic digital content makers.
Rapid Growth: Defying the S-Curve Korea’s early, holistic approach to broadband quickly made it a leader in wireline and wireless broadband. Since broadband services were launched in 1998, Korea has outperformed most countries in broadband deployment and use. By 2000, Korea’s broadband penetration rate was the highest in the world, and it remained so until 2006. Korea still has the highest household penetration of broadband3 and scores highest in measures of broadband quality.4 In 2009, market penetration for fixed broadband services was 32 per 100 inhabitants.5 Consequently, in the early stages of its development, Korea’s broadband market experienced rapid expansion in supply and demand, allowing it to defy the S-curve associated with the diffusion of technologies and innovations (Rogers 1995, 257), which applies to most ICT goods and services (see also Czernich and others 2009). In other words, it grew at a much faster rate than expected in the early years of development, so a relatively high penetration rate was reached very quickly. In the early years of broadband development, Korea’s 39