Communication Equipment Is In Critical Situation…Government, Mobile Communication Companies, Equipment Industry Are Having Difficulties In Coming Up With A Solution Due To Difference In Their Point O
Jul 21, 2015
People that are concerned in communication equipment industry such as people from government, communication companies, equipment industry are disagreeing with each other’s opinions as they look for a solution to solve critical situation. Considerable amounts of suffering and loss are expected as they are only confirming each other’s position as they look for a breakthrough. Equipment industry is worried that Korean companies will be driven away into withering situation if the government doesn’t prepare a plan to vitalize this industry with strong will.
‘National Communication Equipment Industry Vitalization and Debate for Future’ took place at National Assembly on the 20th under the supervision of Korean Institute of Communications and Information Sciences (KICS), Korea Venture Business Association (KVBA), and Korea Association of Network Industries (KANI). Assemblywoman Kwon EunHee of Saenuri Party and Assemblyman Jung Ho Joon of New Politics Alliance for Democracy hosted this debate. People who participated in this debate were not able to present solutions that can solve difficulties in equipment industry.
“Government announced its strategy to strengthen competitiveness in ICT equipment industry in August of 2013 and it is expanding demands in public markets. It is implementing variety of policies to increase rate of introduction of domestic equipment in public areas, which was 23% at that time, to 35% by 2019.” General Director (Director) Jung Wan Yong for Electronics and IT Industries of Ministry of Science, ICT, and Future Planning’s (MSIP) said about what government is currently doing to improve this situation.
Director Jung announced that it will create new demands through development of next-generation network technologies such as 5G mobile communication and software definition networking (SDN100). He said that it will also push for variety of strategies to coexist with all kinds of companies.
Industry however said that it is difficult to feel variety of policies of government.
Chairman Nam Min Woo of KANI said that it is difficult to even think about next-generation technologies such as 5G, SDN, and NFV when companies that are still surviving until now are having difficult times every day. He also pointed out that although government is presenting variety of policies and announcing numerical values, it is nothing but an ‘optimistic presentation’. He stressed that government, mobile communication companies, and small businesses need to come together and think about solutions by looking squarely at reality.
First Vice-Chairman Shim Jae Hee of KVBA, who presented on the topic from the point of view of small businesses, pointed out that active support from government is needed now than more than ever rather than waiting for MSIP to increase public domestic equipment up to 35%. He also stressed that effort for small companies and win-win growth is desperate because mobile communication companies’ R&D business is being ordered at the lowest bidding price and not recent introduction of equipment.
Mobile communication companies said that although they understand difficulties in the industry, they need to confront against sales and decrease of profit according to change in communication situation. They stressed that decrease of capital investment (CAPEX) results from many main causes, and equipment industry needs to work hard for competitiveness in price and quality.
“Recently large-sized companies that specialize in introduction of equipment asked around to use domestic equipment, but there weren’t any domestic companies that make such equipment. SK Telecom and KT are planning to pursue this business next year, and we hope that equipment industry will develop technology by understanding demands from mobile communication companies earlier.” Director Cho Chang Gil of LG Uplus talked about wants and wishes from equipment industry.
Officer Ha Sung Ho of SK Telecom stressed the need for early supply of frequency and calculation of reasonable cost for next-generation service. He said that Korea pays too much cost for frequency compared to foreign countries, and this cost is needed ultimately for communication market. He also said that they need a system that can prevent overheating auction to develop communication industry.
There are also criticisms against government policy that is set up to enter foreign markets. “Export cooperative was made to export domestic equipment with KANI playing a key role, but there isn’t any relative budget this year. Small businesses gathered and worked hard to make a cooperative, but they are in a very difficult situation because there aren’t any legal or institutional supporting plans.” While making a comment from his seat, Director BaeJumHak of Handreamnet said that government is not helping small businesses at all.
Communication equipment industry is facing withering situation due to decrease of mobile communication’s CAPEX, preference of foreign equipment in public places, and huge decrease of price. Foreign products will take up the spaces that are left by domestic products if domestic communication equipment disappears. There are a lot of concerns that this will decrease competitiveness of domestic communication industry and that this will bring negative effects to national security.
Staff Reporter An, Hochun | firstname.lastname@example.org