IT industry concerned after bill passes to deal with service disasters

The National Assembly's Science, ICT, Broadcasting and Communications Committee endorsed revision bills requiring communication service companies such as Kakao to take preventive measures to avoid such service breakdowns.

Democratic Party Rep. Jung Chung-rae, center, who serves as chairman of the Science, ICT, Broadcasting and Communications Committee, hits the gavel during the committee’s general meeting held at the National Assembly building in Yeongdeungpo District, western Seoul, on Thursday. [YONHAP]

After a 127-hour Kakao service meltdown in October, a parliamentary committee passed bills to prevent a recurrence of such outages Thursday.

The National Assembly's Science, ICT, Broadcasting and Communications Committee endorsed revision bills requiring communication service companies such as Kakao to take preventive measures to avoid such service breakdowns.

The proposals now need to go through a screening process by the Legislation and Judiciary Committee and a plenary session at the Assembly to be made into law.

On Oct. 15, Kakao and its subsidiaries went through a massive service outage caused by a fire at a data center. The meltdown raised concerns over Korea’s heavy dependence on a handful of IT service providers, prompting legislators to come up with preventive measures.

The proposed bills are amendments to the Framework Act on Broadcasting Communications Development and the Act on Promotion of Information and Communications Network Utilization and Information Protection.

The former aims to mandate value-added telecommunication service providers — which provide internet and communication-related services other than key telecommunication services — such as Kakao to implement a data redundancy system and a basic plan in case of disasters. Previously, only major telecom and broadcasting companies were required to take such preventive measures.

The latter proposal requires the IT service providers to report to the Ministry of Science and ICT when their services are shut down in disaster situations.

In 2020, the ICT Committee passed a similar amendment proposal for the Framework Act on Broadcasting Communication Development, but the bill failed to make it through the Legislation and Judiciary Committee. The Legislation Committee dismissed the bill back then, citing over-regulation.

But the situation may pan out differently this time, as the latest Kakao meltdown triggered wide public outrage.

The telecom and IT industries are closely eyeing the bill’s possible fallout on their businesses.

IT companies have been reluctant to make any official statement on the issue, but an increase in data center maintenance expenses remains a major concern.

As implementing a data redundancy system requires a hefty cost and the money may be wasted on overlapping investments, the entry barrier for new players is likely to go up, making the playing field even more unlevel.

“Expenses on infrastructure will double,” said an anonymous source from a value-added telecom service company, according to a Yonhap report. “Large companies may survive, but cash-strapped start-ups won’t be able to afford it.”

“Though I agree with the intention of the preventive measures for disasters, I believe making an adequate supplement for the existing laws is more appropriate [than enacting a new regulation],” said another industry insider.

“The revision may unintentionally undermine the domestic data industry’s competitiveness.”

BY LEE HAY-JUNE [shin.hanee@joongang.co.kr]