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Analysis of WiMAX regulation in South Korea and Indonesia - Presentation


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Abstract—The development and rollout of WiMAX introduces several regulatory and policy issues. This paper highlights the WiMAX Regulation in South Korea, as a country that is already more mature and had become the first to implement Wireless Broadband Access (WBA) of its kind (WiBro) in the world, and Indonesia, as a country that is still in the process of formulating the reconcilable regulation. The paper begins with a brief overview of the technologies behind WiMAX and compared the market situation relative to broadband and 3G mobile networks. Next, the paper examines the potentially significant specific policy and regulatory issues for regulator in each country and competition climate between stockholders. Finally, this data was used to obtain recommendations to overcome the said problems. We found out that WiMAX may prove to be a disruptive technology for existing telecommunication and Internet sector, but careful policy effectuation can ensure that the disruption could create the maximum benefit possible in the society and market.

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Analysis of WiMAX regulation in South Korea and Indonesia - Presentation

  1. 1. Analysis of WiMAX RegulationIn South Korea and Indonesia Laili Aidi Jung Changsu Project Report Presentation IK2214 Telecom Policies and Regulatory Principles
  2. 2. Introduction WiMAX (Worldwide Interoperability for Microwave Access) - fixed and mobile Internet access up to 40Mbit/s WiBro (Wireless Broadband) - a service name in South Korea - a standard of IEEE 802.16e (mobile WiMAX)
  3. 3. South Korea: Market Analysis  nternet subscribers I•  39,440,000 (81% of Korean, June of 2010)•  The market is already saturated.•  Combined services: IPTV, Internet phone and cable TV  ince the introduction of smart phones in 2009: S•  Smart phone users increased by two times 2.6% in 2009 to 5.7% in 2010•  Wi-FI usages were increased by two times•  Increasing demand of data traffic•  Installing Wi-Fi and upgrading 3G networks to LTE
  4. 4. WiMAX Regulation  ackground of the slight growth B•  455,000 in 2010•  Only 23 big cities in 2007  overnments policies G•  Mobile subscription number for voice packet•  deregulation of combined-service: WiBro + 3G, free laptops for 2 / 3 years subscription•  The expansion of service coverage: 82 cities in 2011
  5. 5. Regulatory & Technology Issues  arrow service coverage: N•  Negative policy in marketing and expanding service areas•  No confidence in the success  pectrum allocation S•  2.3GHz (2.5GHz for WLL)•  Excluded in the global roaming project by WiMAX forum  bsence of distinct difference A•  A lot of Internet cafes across the country(22,000 places)•  Already wide-spread wired Internet service The distribution of Internet cafe (•  More expensive price
  6. 6. Indonesia: Market Analysis  opulation P•  242.968 millions (4th most populous)•  GDP US$2,858  nternet subscribers I•  107th from 150 in IDI, 40th from 170 in ISE•  34.850 millions / 14.3 % (March 2011)•  Broadband 256.5 thousands / 0.1% ~ 1/1000 (end-2006).•  Telkom occupies 150 thousands  obile subscribers M•  180 millions / 80 % penetration (6th largest user)•  3 operators dominate, Telkomsel occupies 100 millions (7th largest operator)•  34.85 millions Facebook’ers / 14.3 % = Fastest growing users & 2nd largest ~ Tweeter, Blackberry, Nokia, etc
  7. 7. WiMAX Regulation  ackground B Push Internet literacy in remote areas:•  50 million broadband users in 2015•  Many area cannot be reached by optical cable•  Affordable & develops the domestic industry  icense Auction L•  Fixed WiMAX 2,3 GHz•  2 blocks, 13th block and 14th block, 15 MHz each•  15 zones nationwide,•  8 winners, 3 late payments, 5 left
  8. 8. WiMAX Regulation (2)  nvestment friendliness I•  Providers only partner with local Vendors•  11 WiMAX Vendors•  Local content standard policy: 30% of CPE & 40 % of BS•  Economy consumption rather, not economy production: 44 billion telco’s capital expenditure, 3 % local•  Foreign ownership limits: up to 65% of mobile & 49% of fixed-line Operator.
  9. 9. Regulatory & Technology Issues  pectrum Auction S•  5 years process: delay the auctions until 2007•  Wait local manufacture industry•  Protect incumbent Operators and ISPs  pectrum Allocation S•  Frequency band 3.5 GHz = Telkom’s satellite and PSN IDR & Broadcast)•  most APEC country use Mobile WiMAX, 2.3 GHz International: - Most APEC country use Mobile WiMAX, 2.3 GHz - Excluded in the global roaming project by WiMAX forum
  10. 10. Regulatory & Technology Issues (2)  egulation Consistency R •  Replace broadband strategy for IDE = WiMAX to LTE (mid 2010) •  Review WBA regulation (November 2010) : - Allow mobile WiMAX: Prize taking (paying more) & moveto the rest of the band - Lead to restlessness among stakeholders  ervice Provider vs. Vendor S•  Objection for Fixed WiMAX•  Vendor: market limitation, upstream industry support, technological reason•  Provider: lack of vendor’s capability & commitment
  11. 11. Recommendation: South Korea  echnology combination T•  3G + WiBro•  Compensate short coverage and voice service  evice diversity D•  USB sticks, WiBro+ HSDPA and laptops embedded WiBro  ew service model N•  Increase profit and subscribers•  Combined services approach (DMB + WiBro)  onsistency of policy C•  No organization for Information and Communication•  Ministry of Information and Communication closed
  12. 12. Recommendation: Indonesia  pectrum & Mobility Restriction: Sustainable and S complementary ICT infrastructure•  Strictly implement Fixed WiMAX then hold Mobile WiMAX auction: use the rest 60 MHz•  Mobile WiMAX service restrictions: disable mobility option  Government Subsidies in rural areas•  Grants & low cost loans for infrastructure projects•  Lower income & Equipment is still expensive•  Educate the public  arket Protection M•  WiMAX business model should not disrupt the current business climate•  3.75 MHz & 7.5 MHz channel size usage to 5 MHz or 10 MHz•  Mobile WiMAX limited in the rural area
  13. 13. Conclusion South Korea:•  Government struggle to broaden WiBro service•  People and service providers were not interested in this service. Indonesia:•  Regulator faces some similar problems (regulation consistency & spectrum allocation)•  Market characteristic and political situations are quite different, specific issues arisen (Spectrum auction, relationship between stake-holders) Clear road map of broadband technology in the country