[5G Hegemony War③] Jo Seung-rae "Reviewing 5G Government Support Measures... Extension of Tax Credit Also Under Consideration"

Interview with Ruling and Opposition Party Whips of the Science and ICT Committee Ahead of the National Assembly Audit

The main topic of the first National Assembly inspection by the 21st National Assembly Science, Technology, Information and Broadcasting and Communications Committee (STIBC) scheduled for next month is expected to be 5G communication. There is no disagreement between the ruling and opposition parties that urgent and effective measures are needed to secure 5G leadership since its world-first commercialization. Asia Economy diagnosed Korea's current status after 5G commercialization and explored desirable policy directions such as promoting investment to lead the 5G hegemony through interviews with the ruling and opposition party secretaries leading the STIBC.

Assemblyman Jo Seung-rae [Photo by Office of Assemblyman Jo Seung-rae]

[Asia Economy reporters Seulgina Jo and Nahum Kang] "It is necessary to check whether government support measures actually lead to 5G communication investments by mobile carriers."

On the 28th, Seungrae Cho, the ruling party secretary of the National Assembly Science, Technology, Information and Broadcasting and Communications Committee (STIBC) from the Democratic Party of Korea, said in a written interview with Asia Economy, "Korea must seize the 5G leadership in the global market and play a leading role in the future era," citing 5G infrastructure, equipment, and content as the most important factors to achieve this.

Cho explained, "While the private sector is building the 5G network, the government is also supporting it through investment tax credits," adding, "The tax credit, which is scheduled to expire at the end of this year, can be extended after reviewing its effectiveness and necessity. The increase in the credit rate is also possible." However, he pointed out that it is necessary to verify whether the government’s support measures are actually translating into 5G investments by mobile carriers.

Currently, Korea does not have a separate budget allocated for 5G construction. As part of investment incentives, a 2% tax credit (2% + 1% in non-capital regions) for 5G network investment has been implemented, but there are calls for its expiration because mobile carriers have not submitted data considered trade secrets to research institutions. Regarding this, Cho noted, "It should also be considered that investments were less than promised by mobile carriers in the first half of the year," implying that before support measures, the three major carriers must proactively expand their investments.

Cho also expressed expectations for content, which is regarded as the "flower of 5G." Having shown great interest in content by launching the first content-related research group in the National Assembly, Cho emphasized, "As confirmed by the popularity of K-dramas and movies, our stories and sentiments resonate globally," adding, "If immersive content incorporating augmented reality (AR) and virtual reality (VR) is activated, Korea will firmly establish itself as a leading 5G country."

He explained that combining digital capabilities with globally recognized K-content such as games and movies to create content on a different level is the core competitiveness. Furthermore, he said, "Creating 5G demand is also a support measure," citing the government’s ongoing 5G public business network construction project as a representative example.

Among recent STIBC issues of interest, he pointed out application market fees and network usage fees by global content providers (CPs). Cho said, "It is problematic when certain operators, regardless of domestic or international status, disrupt the entire ecosystem by abusing market dominance," explaining that they are focusing on whether Google Play Store and Apple App Store use their superior position to force specific payment methods and unjustly delay app reviews.

Regarding concerns about the so-called "plant STIBC," he remarked, "With the Digital New Deal as a core axis, STIBC has now become the most important standing committee," adding, "It should not become a burden during this great transformation by falling into futile political strife as in the past." He also added, "If broadcasting becomes an obstacle again, creating a separate discussion table for the broadcasting sector could be a solution."