The growth of broadband and electronic commerce in South Korea: Contributing factors

From 1998 through 2001, South Korea witnessed a remarkable diffusion in broadband Internet connections. Using published and other data, this paper explores the actions and factors contributing to this diffusion from three viewpoints: government, private sector, and social. We suggest that the matching of demand and supply is the most important factor in the fast diffusion of broadband in Korea. In particular, fierce infrastructure competition led to quality services at a low fixed price. Online gaming exhibits some of the characteristics of a "killer application"; there are also some social and cultural drivers of demand. We then consider the impact that this rapid diffusion has had on electronic commerce. We produce conclusions of value to policymakers.