Every so often a pundit or a journalist rediscovers South Korea and presents it as a broadband nirvana. And it is! Still, not many try and write about how South Korea became center of the broadband world. No mention of South Korean government’s generous subsidies or its not so gentle nudge that forced incumbents out of its slumber. Its a case study on why governments need to get actively involved in the broadband rollout. In comparison we have a murky situation in the US, where incumbents are playing wait and see game. The municipal broadband is still being stopped in its tracks. San Francisco Chronicle goes to Seoul and brings back a very complete picture of how broadband has changed South Korea. The rollout of broadband has made some high-speed services possible and thus has fostered new innovation and new start-ups, especially in online gaming and entertainment space in South Korea.
Even American companies are finding that if they want to innovate, their early market is going to be Korea. Microsoft has done well with its MSN Mobile, and so have others. But this doesn’t mean that Koreans are happy buying other people’s technology. They are now working hard to take control of their broadband destiny. WiBro, the fixed wireless standard is a way to keep out American tech giants, and help grow local technology business. Koreans believe that the next generation WiBro networks – three of them – will help “raise Korean gross domestic product to $20,000 per capita from $12,600 in 2003, the latest available figure. In the United States, GDP per capita was $40,000 in 2004.”
This has long term ramifications for Silicon Valley. For the longest time SV has been home to the latest and greatest technology, mostly because US was a nation that “early adopted” technology. With marginal broadband in US, most innovators still cannot comprehend and start companies based on a near ubiquitous broadband experience. Slowly, it is going to start eroding American competitiveness in one of three industries which are still big export dollar generators. (Fast Food and Hollywood being the other two!) South Koreans want to become players in global markets, and are going to leverage their domestic knowledge worldwide. (Remember we used to do that in US.) Chinese want to do precisely the same. These are new reality of post-broadband world. (As an aside, I must mention that the challenges of wiring up a country the size of US are many.)