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Regulations are strangling tech

May 29,2018
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SOHN HAE-YONG
*The author is an industry news reporter of the JoongAng Ilbo.

Blockchain and quantum communication are considered key new technologies for the fourth industrial revolution.

The Institute for Information and Communication Technology Promotion’s survey of 124 experts in the industries as well as academia and research institutes showed that Korea is doing pitifully in this important field. Korea’s blockchain technology level was 76.4 percent of the United States, 2.4 years behind. Europe was 96 percent of the United States, Japan 84.8 percent and China 78.9 percent.

Quantum communications uses quantum encryption to prevent hacking and enhance speed and accuracy. Korea’s competence in the field was 73 percent of the United States, or four years behind. It is greater than the gap between China and the United States. Korea is ranked low among competitors in 10 information and communication technologies (ICT), including networks, satellites and mobile communication.
Internationally, the ICT industry is shifting the focus from hardware to service and software. Uber and YouTube are good examples.

Tech and Law’s attorney Koo Tae-eon says that these companies started in environments with low regulatory barriers. Korea Economic Research Institute head Kwon Tae-shin said that they secured their competitiveness in a business-friendly environment.

But these are other countries. Korea has to nurture online banks, but industrial and banking capital is still separated by law. The big data industry is trapped by the personal information protection law and cannot find an escape. The Korea Chamber of Commerce claims that 47.5 percent of the 700 companies in new industries had setbacks due to regulations.

Antimarket policies, such as the steep minimum wage and forced regular employment, are dragging down companies. Small and medium-sized tech companies cannot grow into big companies if they abide by 52-hour workweek. Success is not guaranteed even when they have their employees work 20 hours a day.

On May 23, French President Emmanuel Macron hosted a Tech For Good event, inviting tech giants including Facebook founder Mark Zuckerberg. Here, Macron received investment and employment plans from Microsoft and Google on fourth industrial revolution fields such as artificial intelligence.

The Korean government advocates innovative growth as its economic growth strategy. But the government is slow at easing regulations and this continues to press companies. At this rate, the fourth industrial revolution will be dominated by the United States and China.

JoongAng Ilbo, May 28, Page 29