[The Editors' Verdict] Conditions for the Rational Development of Self-Owned Networks

Since the mention of "Wi-Fi refugees" in the movie Parasite, various discussions have unfolded regarding the establishment of public Wi-Fi by local governments. Last year, Seoul City led a pilot project to build public Wi-Fi named "Kkachinet," which caused conflicts with the Ministry of Science and ICT. The precise term for self-owned networks like public Wi-Fi is "self-communication facilities." Self-communication facilities refer to telecommunications equipment installed by a specific individual for their own telecommunications use, excluding commercial telecommunications facilities. They are generally utilized when building public communication networks is uneconomical or difficult to address. From the perspective of local governments, the reasons for preferring self-owned networks include the freedom to choose the network construction method, avoiding cost burdens from leasing networks of existing telecom operators, and the ability to independently build networks to stably promote telecommunications-related projects.

However, the construction of self-owned networks still causes conflicts among local governments, government ministries, and telecommunications operators, necessitating in-depth discussions to resolve these issues. Since the enactment of the Act on the Construction of Ubiquitous Cities in 2008, which mandates the introduction of ubiquitous technology based on information and communication technology when constructing cities of a certain scale, controversies over self-owned network construction have continued. These began with conflicts between those seeking to expand self-network connections and government ministries concerned about overlapping investments in communication networks and the undermining of the foundation of telecommunications businesses. Recently, institutional improvements such as expanding the scope of self-network use for smart city construction have been made in response to local government demands. During these discussions, local governments have expressed their intention to directly provide services through self-owned networks to alleviate citizen inconvenience and dissatisfaction. They also believe that self-owned networks are advantageous for timely service delivery amid the increase in new smart city services. On the other hand, opinions have been raised that providing telecommunications services to citizens through self-owned networks violates the Telecommunications Business Act, and that utilizing the nationwide networks of licensed telecommunications operators is not only stable but also economical.

In this context, there are essential matters that must be discussed to establish a desirable direction for future self-network construction and to develop policies that balance the advancement of the information and communication industry, which forms the foundation of South Korea's competitiveness. First is the clear interpretation of laws related to self-network construction. The conflicting views that providing Wi-Fi services to citizens through self-owned networks violates the Telecommunications Business Act and that it is an obligation of local governments under the Local Autonomy Act must be reconciled. A thorough analysis of how amendments to the Telecommunications Business Act would impact the telecommunications industry is also necessary. Second, discussions are needed on whether self-network construction hinders the development of public communication networks rather than complementing them. Issues such as the privatization of telecommunications, whether fair competition is impeded, and whether local governments' self-network construction weakens their core business objectives are also preliminary tasks. Lastly, economic feasibility must be considered. Economic analyses conducted so far on self-network construction and the use of networks by licensed telecommunications operators have yielded differing results among analysis institutions, so more objective outcomes are needed. In particular, in-depth discussions should be held not only on cost comparisons related to network construction but also on how social costs can be justified. Through comprehensive discussions on self-network construction, it is hoped that policies can be established that enhance both industrial development and social welfare.

Shin Minsu, Professor, Department of Business Administration, Hanyang University