e-Cities in South Korea

E-CITIES STRATEGY

It is important to remember that e-cities engage all the other e-strategies. Korea’s holistic e-strategy planning epitomizes this.

As such, it is not unexpected that Korean interest in the development of the smart city goes back more than two decades.

However, as its successive e-strategies (starting with Cyber 21 in 1999 and culminating in U-Korea Master Plan 2006), e.g. e-government, e-health, etc., have matured into today’s u-strategies (strategies based on the notion of ubiquitous computing ).

Korean regional, local and municipal governments have become more enamored with the potential for ubiquitous computing to solve many of the problems caused by Korea’s exceptionally high urban density.

At the same time, both central and regional government sees u-cities (e-cities) making an important contribution to meeting the goals that Korea has repeatedly set itself of creating multiple sector growth engines in general, e.g. construction, and e-city infrastructure and service solutions.

In particular U-cities (e-cities)are seen as the economic focus and showcase for the next generation global growth engine that will achieve world leadership for Korea’s ICT industry and its construction industry.

In many ways, the urban density (and in particular apartment dwelling ) has made it easier for Korea to develop its ubiquitous advanced high-speed, all-pervasive broadband communications networks more rapidly than many other countries, e.g. UK.

Many years of state oriented (largely the KNHC, KRIHS, KHF, KLDC ) and privately enacted (Chaebols) urban development coupled with a world-wide trend for urban populations to grow at the expense of rural communities has resulted in many large city issues.

Issues typical of all major connurbations (Congestion, and Environmental) along with poor Building Standards in Korean urban areas have been exacerbated by rapid industrialization accommodated by relatively uncontrolled urban development.

Leading the way in Korea’s push for the e-city have been the individual local authorities, e.g. Seoul Metropolitan Council. This has led to a plethora of smart city projects across the country.

Seoul commenced planning of its Sangham Digital Media City (DMC) as far back as 1992 (feasibility planning was completed in 2003), development commenced in 2004 and completion is due in 2010. Sangham DMC’s goal is to become the IT industrial center (global leadership) for digital media and entertainment in NE Asia.

This has been followed by a cluster of developments around Seoul – Paju, Kwanggyo, Hwasung,Yongin and one of the largest and most ambitious developments of all - the $128 billion (15% of Korea’s GDP) Incheon Free Economic Zone (IFEZ), 1 Hour South West of Seoul – This massive development includes the Songdo District ICT Hub, Cheongna Tourism Hub, and Yengjon Global Logistics Hub and is expected to embrace a combined population of 2.66 million.

Elsewhere, Busan – Korea’s 2nd., largest city and port in the south of the Korean peninsula.

Blighted by early rapid industrial development; Busan's city fathers were quick to adopt Korea’s emerging technological strength with an investment of around $1 billion (2005 to 2010) to turn the port of Busan into a super port (with the latest RFID based container tracking systems), auto and business clusters, convention center and advanced city administration control systems.

Others include Sejon (Korea’s proposed new capital city), Jeju Island (focusing on tourism), Kwangju, Jenju, Taejon, Chungbuk, and Pusan (another port development), etc.

Although largely driven and supported by the Korean government; these various e-city initiatives each have their own particular local focus and exhibit considerable variation in terms of:

1. Vision, theme and business models for economic viability
2. Mix of public and private sector stakeholders and collective funding – public (municipalities and central government) and private sector (local Chaebols, e.g. LG Electronics, Korean Telecom (KT), Posco and international involvement in real estate developments, architectural design, and infrastructure development , etc.
3. Level of regulation.
4. Level of ecological and environmental design considerations.
5. Development – e-cities can be either sites within existing city boundaries or ‘green-field’ new u-city developments (e-cities).
6. Level of integration achieved between sites and their synergy with national strategies for economic development.

Once again, sensing the commercial opportunities domestically (in an otherwise saturated ICT market) and internationally, the Korean Chaebols have scrambled to become involved in developing the services and infrastructure for the future e-city, that has been central to the Korean government’s IT839 strategy and subsequent u-modifications.

Of particular importance being the basic infrastructure that makes comfortable, healthy, safe and pleasant u-city blueprint possible:

1. Broadband Convergence Network (BcN)
2. Universal Sensor Network (USN) – based on wireless communications and RFID Technology
3. IPv6

Enter the Chaebols

The Chaebols have been investing heavily in R&D, systems development, promotion (joining government sponsored overseas missions ) and in the e-cities real estate themselves, e.g. building R&D centers, both in Korea and overseas – heavily supported by the Korean government and government funding, e.g. $856 million in RFID sensor technology alone.

Samsung Data Services (SDS) is quoted as saying that it has been actively ‘preparing’ (R&D and investment) for e-cities since 2004.

In 2005 Korean Telecom (KT) signed agreements with Korean National Housing Corporation (KNHC) to invest around $90m to develop an enhanced crisis management system for the new town of Unjeong (near the North/South Korean border) along with investment into several other e-cities.

LG is partnering Posco and Gale International in Songdo. In 2007 Daiwoo signaled its engagement with the u-city program by establishing its own R&D organization, investing heavily in USN, Pang-yo u-city (along with Samsung) and looking to develop a much broader u-city offering that goes well beyond technology, e.g. project financing purchasing real estate and developing urban planning capabilities.

As a result, the Korean e-city strategy had by 2008 rapidly developed into a petri dish for urban planners, environmentalists and technologists.

In 2006 the Ministry of Information and Communications (MIC) and the Ministry of Construction and Transportation (MOCT) signed an MOU to coordinate their efforts on u-city construction and the laws associated with it.

This resulted in some order to the urban planning process in Korea (particularly e-city planning) and also reflected the growing importance of ‘green cities’ (seen by Korea as yet another growth engine ).

That is e-cities that are also sustainable in terms of their environmental impact. In 2008 the Korean government enacted the ‘Act on Ubiquitous Construction’.

The Act attempts to coordinate multiple industry sector convergence, e.g. construction and ICT; pan-government planning for u-cities greater than 164 ha, i.e. top down planning from central government to local government and IT business’.

In addition, the National Information Society Agency (NISA) developed a guideline for u-city infrastructure to help avoid costly duplication of technologies at the local level.

Collectively, this covers the u-infrastructure, u-services, u-spaces and u-citizen and together with the requirement to produce a u-city general plan on a national level, u-city plan on a city level and u-city construction plan on a project level – comprise the new regulated u-city planning regime.

The Korean government has also initiated and funded a raft of what it calls value creator projects designed to develop essential understanding in u-city development via the Ministry of Land, Transport and Maritime Affairs (MLTMA), Korea institute of Construction and Transportation Technical Evaluation and Planning (KICTTEP), academia and other agencies.

Examples are the:

1. The Mega Korean Construction Technology Project designed to raise the quality of life ($100 million)
2. The Korean Land Spatialization [Spatial] Program ($122 million government funding, $42 million private funding)
3. The establishment of a Center for Sustainable Housing, with the goal of reducing the carbon footprint by 40% through the use of technology, e.g. energy monitoring
4. The establishment of the Construction Waste Recycling Research Center aimed at reducing construction waste by 80% through recycling
5. The Ubiquitous Eco-City Project aimed at merging environmental (landscape), ecological and technological considerations into the u-city design and planning processes.
6. The establishment of the Korea Urban Renaissance Center, among others.

Whilst a large portion of the original technology has been developed in the USA, Europe and elsewhere – the more ‘relaxed’ social and ethical restrictions in Korea has enabled Korea to accelerate development of the u-city concept in Korea and to experiment with its many facets, and this too, has encouraged overseas multinationals to join in.

E-CITIES CHALLENGES

For Korea to exploit its world lead in u-city developments on a global scale in accord with its government’s aspirations; Korea will need to:

1. Develop holistic multi-function u-city plans, predicated on realistic and achievable macro and micro-economic expectations and adequate funding to ensure overall success of its program and a showcase for future international prospects.
2. Develop a reliable infrastructure compliant with evolving world-standards and acceptable globally (a traditional area of difficulty for Korea) along with secure and reliable administrative command and control centers for controlling municipal assets and utilities efficiently, effectively and non-obtrusively.
3. Development of relevant and world beating solutions in the six key u-city areas of Transportation, Utilities, Education, Healthcare, Public Safety and Government services.
4. To achieve a truly ubiquitous u-city environment – these solutions will require an unprecedented level of innovation to fully exploit the full spatial context of the u-city from home, school, work place, production areas and everywhere in between. It will also need to exhibit ‘the notion of the ‘Internet of Everything’ enabling all manner of everyday devices to converge, the universal application of sensors and automatic readers and ‘in context’ communication. Processors will need to be embedded transparently (and unobtrusively) in mobile (MUCE) and built ubiquitous computing environments (BUCE).
5. Develop smart government and new forms of governance for the smart e-cities through changes to local legislation, policy and regulations (that will drive domestic consumption) and more readily align with the requirements of more rigid overseas markets, e.g. environmental policies, privacy and security, planning permissions, etc.
6. Develop the three T’s – Technology, Talent and Tolerance identified as essential ingredients for the post industrial ‘creative economy’ that will take up residence in the u-city and to do this in a more ‘high tech – high touch’ way than is customary in Korea to attune to international norms – where government intervention on a Korean scale can often be viewed suspicious and obtrusive.

E-CITIES CONCLUSION

In addition to Korea’s excellent holistic planning capability; Korea's resolve to provide exportable indigenous solutions for all aspects of the u-city (e-city) from construction to communications, transport to telemedicine and supporting spatial solutions and ubiquitous sensor networks - Korea readily accepts and absorbs technology from overseas.

This policy which in the past has enabled it to grow into an chip manufacturing, shipbuilding and automobile superpower – the precedent for becoming a global superpower in all aspects of u-city (e-city) development (technology and solutions).

Once again, Korea’s marketing capability is poor and it will be far harder to invent; copy and enhance; and sell complex u-city concepts than relatively tangible objects like automobiles and DRAM memory chips (where it is no. 1 in the world).

Its language and culture will make it difficult to penetrate the more cautious, risk averse – some would say sophisticated ‘regulatory cultures’ of Europe and the USA.

Asian markets too, may prove to be very similar to Korea in their thinking – seeking to take in Korean expertise and experience and ‘copy’ the results with typical Asian efficiency and with the benefit of even lower production costs than Korea.

U-cities (e-cities) embrace all e-strategies to some extent, however, their synergistic use in the u-city space is of such complexity that as each year passes and Korea continues to invest in this massive technology-enabled socio-economic experiment - it builds barriers to entry and substantiates its place in this ‘blue ocean’ market.

Very few countries could unify the initial uncoordinated u-city developments in a way that the Koreans can (if only they could garner the same following internationally).

Rationalization across government Ministries and of government Ministries themselves has been underway in Korea since 2008 with the creation of the Ministry of Knowledge Economy and new coordinated planning regimes are being implemented.

Clearly the u-city concept is the biggest ‘blue ocean growth opportunity’ of all, embracing and drawing together, as it does, all other Korean e-strategies, e.g. e-health, e-government, e-learning, e-commerce and e-innovation, and potential growth engines into a single economic entity.

Irrespective of the commercial success Korea manages to derive from the u-city concept – it will certainly assist global leadership and showcasing in individual e-strategy areas, e.g. e-government and e-health.

However the development of international niche markets may not prove sufficient return on investment in the long run.

There remains the opportunity to ‘gate’ their technology and u-city concepts through more effective overseas sales channels by licensing agreements with foreign multinationals and to develop its BUCE and MUCE technologies in ways not to dissimilar to the way Korea has successfully built up its chip industry.

It may well be that this increased granularity is already anticipated in the growth engine policies of the MKE rather than the more grandiose claims of Ministries and Municipalities, i.e. the opportunity to sell RFID based sensor hardware rather than integrated e-safety hardware and software solutions. The biggest threat to Korean ambitions for global leadership in the race to develop the truly ubiquitous city (u-city) is the very pioneering role that Korea is playing (not a traditional role for Korea).

This is not simply a question of copying and embellishing technology from overseas – it requires a huge amount of innovation, invention, policy, regulation, investment, management and application. A far cry from developing memory chips, LED displays, automobiles and even ships.

Whether the Korean government and its powerful Chaebols has the stamina or resources to complete this very long and arduous journey is debatable – particularly with aggressive economies like China waiting in the wings.

Foreign direct investment is likely to be insufficient to bridge any funding gap given Korea’s lackluster performance in this area to date.