Seoul City Requests Lease of Utility Poles from KTOA...Reigniting 'Local Government Private Network Controversy'

Seoul City Requests Lease of Telecom Poles from KTOA
Local Governments Expanding Private Networks for 'Unspecified Majority'
Telecom Industry: "Duplicate Investment Dampens Telecom Investment Vitality"
Violation of Telecommunications Business Act vs Telecom Basic Rights and Welfare

[Asia Economy Reporter Koo Chae-eun] The Seoul Metropolitan Government is causing controversy by requesting telecommunications companies to lease utility poles owned by them for communication purposes. The telecom companies are in a difficult position regarding Seoul's request, as they have opposed the construction of municipal self-owned electric communication facilities (self-networks) for communication mediation purposes, citing reasons such as redundant investment.

According to the telecommunications industry on the 4th, Seoul sent a cooperation document titled 'Leasing Utility Poles for Self-Network Utilization' to the Korea Telecommunications Operators Association (KTOA), requesting the use of telecom poles owned by telecom companies to build a self-network. The main point is that if the utility poles installed for laying communication lines are leased, they will be used to build Seoul's self-network.

Seoul Requests KTOA, with Members SKT, KT, LGU+, to Lease 'Utility Poles for Communication'

KTOA, whose members include SK Telecom, KT, and LG Uplus, is seeking opinions from telecom companies regarding Seoul's request, but the response is lukewarm. There is a legal concern that a municipality, which is not a licensed telecommunications carrier, providing communication services through a self-network infringes on the telecommunications business domain. Telecom companies have long opposed municipal self-network construction targeting the unspecified public, citing redundant investment, violations of the Telecommunications Business Act, and resource waste, so the long-standing issue of 'municipal self-network construction' is being reignited.

A telecom industry official said, "A municipality installing a self-network is essentially viewing communication as a 'public good' and attempting to nationalize all networks to attract it as a national key industry," adding, "This raises problems as the principle of 'competition' in telecommunications disappears." Another industry insider said, "We have invested heavily in building network infrastructure and spend on maintenance and repair, but if municipalities indiscriminately establish self-networks targeting the unspecified public, management will not be efficient and it could dampen the investment vitality of private telecom companies."

Professor Kim Hyun-kyung of the IT Policy Graduate School at Seoul National University of Science and Technology pointed out, "Municipalities building self-networks targeting the public without legal amendments may violate the law," adding, "The self-owned communication facilities that municipalities can operate are not concepts open to the unspecified public, and even non-purpose use is strictly limited."

KTOA Affiliates 'Coordinating Opinions' amid Large Differences between Seoul and Ministry of Science and ICT

However, telecom companies involved in Seoul's project find it difficult to outright oppose it, leaving them in a dilemma. A KTOA official said, "There are differences in positions among member companies," adding, "We are coordinating opinions."

There is also significant disagreement between Seoul and the Ministry of Science and ICT, the main government agency for information and communications. A Ministry of Science and ICT official stated, "It is not compliant with current law for municipalities to open self-networks to the public and engage in communication mediation," emphasizing, "Regardless of whether a specific municipality is right or wrong, communication mediation through self-networks is not permitted under the current system."

A Seoul city official said, "The self-network construction project aims to utilize existing resources and facilities and minimize budget to expand citizens' basic communication rights and welfare," adding, "Article 31 of the Informatization Promotion Act includes policies to bridge the digital divide, and the Framework Act on Broadcasting and Communications Development and the Local Autonomy Act specify the right to receive services equally, so we are promoting the self-network construction project from the perspective of citizen welfare."