IPTV Could Be Categorized as a Broadcast

Telecommunications service providers and major corporations will now be allowed to participate in the Internet Protocol (IP) TV business.

However, as IPTV is classified as broadcasting, it will stir up controversy. IPTV enables Video on-Demand (VoD) and interactive data communications by connecting Internet access lines to TV sets.

A prime ministerial advisory group called the Committee on Promoting Broadcasting and Communications Convergence announced its final draft titled, “Policy Measures to Adopt IPTV,” which mainly focuses on the above, on April 6.

The committee said regarding the entry into the IPTV market, “Concluding the meeting, most agreed with the idea of not imposing barriers for dominant telecom service provides (that is, SK Telecom and KT) and major corporations to enter the market.” Only a small percentage of the attendees said that dominant telecom service providers and major corporations ought to be allowed to enter the IPTV business by establishing their own subsidiaries.”

The committee also decided to ease restrictions on the share of daily newspapers and news agencies from the current 33 percent to 49 percent. The share proportion of foreigner media is to be limited to 49 percent in accordance with the Broadcasting Act.

The committee defined IPTV service as “a mostly broadcasting service with additional communications services.” According to the definition, IPTV providers are categorized into broadcast service providers, so they are subject to regulations regarding their real-time broadcasting and VoD licenses.

Meanwhile, the Korean Cable Television Association (KTCA) and others in the broadcasting sector welcomed the news.

The KTCA said, “There is ample cause to welcome this measure, and it is the cable television networks’ intention to apply broadcasting regulations to IPTV, a broadcasting service, as well.”

In contrast, telecom service providers expressed regret, saying, “It could dampen any chances for the business in the first place.”

One official of the telecom service sector said, “IPTV telecom service providers seek to adopt the concept of broadcasting,” adding, “Categorizing the business as broadcasting denies the convergence of broadcasting and communications.”

Another official said, “With the current the Broadcasting Act applied, telecom service providers cannot even join the IPTV business.” That is because the Telecommunications Business Act stipulates that the stake of domestic corporations whose foreign stakes are less than 15 percent are not included in the total foreign stake totals of the business. However, the Broadcasting Act includes them in the total stake accounting process.”

It was accepted as a majority opinion that the service is to be provided nationwide in terms of business implications. Only a small portion of the participants said that the service would be provided specifically for different regions.

The committee is expected to sum up both majority and minority proposals, brief the prime minister next week, and pass the proposal on to the Select Committee on Broadcasting and Communications. The Select Committee will comprehensively review the proposals from the Ministry of Information and Telecommunications, the amendments of the Broadcasting Act, and the opinions of the Committee on Promoting Broadcasting and Communications Convergence to confirm on the specifics of the bill.