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Dr Kim Seang-tae is the President of the South Korean National Information Society Agency (NIA). He is also one of the Commissioners of the ITU / UNESCO Broadband Commission for Digital Development. Dr Seang-Tae is the chief architect of the FttH miracle that is transforming South Korea. In discussions with Paul Budde, Dr Seang-tae cited elements of South Korea’s broadband success.

His broadband journey began in 1994, when he developed the country’s first broadband plan. In all, over US$70bn has been invested by the government over the last 15 years, and as a result high-speed broadband is very affordable and subsidies are in place for rural users and others who might otherwise not have been able to pay for access. The country now has over 70% high-speed broadband coverage with an uptake rate of above 50%. This large-scale result and high penetration level is now also opening up the market for new mass market services.

There is now a clear trend towards a trans-sector use of the infrastructure and Dr Seang-Tae also envisages that this will eventually lead to ‘free broadband access, and that revenue will be generated from the services that are being provided over the infrastructure’.

From the very early days this was government-driven top-down policy. Korea does have a Presidential Committee on e-Government and this comprises all the various government sectors such as healthcare, education, energy, transport, etc. This goes one step further than the trans-sector units which operate from the offices of the Prime Ministers of Australia and New Zealand and at the White House.

Back in the 1990s it was very much the industry that took the lead from the government and built Korea into the smart country it is today – an example to the rest of the world. Nevertheless, despite its success, silo thinking continues to be a problem in advancing the social and economic benefits more quickly.

This gave Dr Seang-Tae the idea of looking at what would be further needed to improve this situation – the Presidential Committee, despite its success, is still not sufficient to make this happen. He had the novel idea of looking to the concept of an Academy for key people in (the departmental silos of) government and politics and to teach them about the economic and social benefits that a trans-sector approach to the use of broadband infrastructure. Because the issues are universal, this could indeed be an International Academy, which could also greatly contribute to assist the developing countries.

See: South Korea

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The future of broadcasting has been under discussion for close to two decades and, while changes are certainly happening, they are rather slow and therefore new opportunities or threats (depending on where you sit) continue to arise.

On the one hand we are now starting to see the more widespread availability of digital TV and this has revealed a clear point of difference between the strategic directions being taken by the telecoms and the broadcasting industries. Less emphasis is being placed by the broadcasters on the Internet-based opportunities and more on adding TV-based entertainment to their offerings. They do have access to good quality entertainment, which is protected through rights and royalties, and this helps them to withstand the tsunami of technology that is undermining their business model.

So the effort of the broadcasting industry is now clearly focussed on digital TV.

However, at the same time the TV set is now turning itself into a multiple function screen. In the USA it is estimated that in 2010 more than a quarter of all TV sets will be Internet-enabled.

The focus of the broadcasters seems to have moved away from their fear that DVR was going to enable viewers to skip advertisements. However, their next worry will be that viewers will move away to Internet-based TV – in other words, they will lose them, not just for the ad breaks, but from traditional TV entirely.

The launch of Apple TV is going to further undermine, not only the traditional broadcasting model but now most certainly the pay TV (cable TV) business model and new telco models based on IPTV also. Through an unobtrusive and cheap box (US99), with a simply click on the screen, apps can be activated that will deliver TV Apple TV content on the normal TV screen.

Link this to the new Internet TV sets and think about the iPhone business model with the Apps and it is not too difficult to envisage that a myriad Apple TV apps will become available. Apple has not yet launched the business model for this service but the other IPTV and VoD models are certainly going to find it extremely difficult to compete with Apple TV. The exclusive content arrangements the broadcasters enjoy will save them for a while but in the end if Apple TV becomes commercially interesting allegiances will start to change.

Also important to realise is that soon there will, no doubt, also be an ‘AndroidTV’ model, this will further open up this market and even further threaten the traditional TV models.

Hopefully the broadcasters will not concentrate their activities on trying to stop this from happening. It is to be hoped that instead they will embrace the opportunities that these new developments offer by linking their content to the new technologies, become TV Apps providers over these new distribution models. They will need to look at broadband/Internet/apps as just another medium to deliver content to their viewers.

Cable and Pay TV operators in particular will be under pressure to drop their bundled packages and offer their content on an à la carte model.

In countries where broadband infrastructure is lagging behind broadcasters perhaps have an opportunity to become players in this market via the digital TV technology.

Obviously the broadcasting business models that based on geographic licences will need to be changed as well.

However, it looks as though Apple TV will demolish the IPTV and VoD models that telcos are now trying to establish in order to generate new revenue streams. It is again a case of too little too late. The telcos have been looking at these models since the 1990s (triple play) but, similar to the mobile portal models for mobile phone content, they have not been able to build the appropriate business models  that would have propelled them to the forefront of these developments.

Paul Budde

See also:

• Digital Media – Broadcasting – Digital TV
• Digital Media – Google & Leading Internet Media Companies
• Digital Media – Impact on the Media Industry
• Digital Media – Internet & Entertainment Services
• Digital Media – Online Video Media
• Global – IPTV & Home Theatre Insights
• Global – Mobile Media – Mobile TV & Video
• Global Digital Media – Entertainment Trends and Statistics

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An independent economic review of Victoria’s smart meter roll out has found that the benefits far outweigh the costs of vital infrastructure upgrade. Smart meter technology will benefit consumers and transform a critical piece of energy infrastructure from the mechanical into the digital age.

The independent report concludes smart meters will deliver benefits for Victorian families which include tools to manage their energy bills and connect more easily to new technology such as solar panels. The report also found that the smart meter program is cost effective no matter which mix of costs and benefits are used. The vast majority of the benefits that are forecast to result from smart meters will ultimately flow to customers.

Smart meters have two-way communication capabilities which means:

• Customers won’t have to pay for manual meter readers
• No need for a truck to visit for disconnections or reconnections
• Fewer estimated bills.
• Distribution businesses will automatically know if the power goes out and in many cases will be able to reconnect the power more quickly.â€�

Recent applications to the Australian Energy Regulator by distributors to change charges will see the cost of connection and special meter reads slashed. A special meter read currently costs $32.90, but once a smart meter is installed that cost will be no more than $2. Power connection currently costs $23. With a smart meter that cost will fall to around $5.

The report shows the cost over 20 years of installing smart meters is $1.621 billion dollars while the cost of continuing with current metering services would have been $1.459 billion. The cost of installing smart meters, above what it would have cost to maintain the existing system, is $162 million. Over time consumers can expect additional benefits of $415 million.

A key finding of the report is that consumers will receive the low case benefits from the infrastructure upgrade without any behavioural change on their part.  This is a result of moving from manual to automated service delivery. It also finds that if people use the information provided by their smart meter to reduce energy consumption or take advantage of new products and services expected to be offered by retailers, then the benefits will increase even further.

If there is a reasonable uptake of optional activities by customers the benefits could be as high as $5 billion. Optional activities could include the take up of new pricing offers, customer information tools or appliance control devices. In addition to the benefits for Victorian households the Victorian roll-out of smart meters has helped create more than 700 jobs.

Smart meters are being rolled-out to all homes and small businesses in Victoria and more than 250,000 have already been installed. The cost of the roll-out is being met by a set metering charge for each electricity customer – this year that charge is on average $17 per quarterly bill or $68 per year.

At a Council of Australian Governments’ meeting on 10 February 2006, chaired by then Prime Minister, John Howard, all States agreed to a national rollout of electricity smart meters where benefits were found to outweigh costs.

For more information please see:

Australia – Smart Grids Analysis – The market in 2010

Australia – Smart Grids – Climate Change and Photovoltaics

Australia – Smart Grids – Demand Side Management

Australia – Smart Grids – Major Players

Australia – Smart Grids – Smart City – Smart Grid Project

Australia – Smart-Grids – Smart-Meters

 

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