Analysis on the Technical Efficiency and Productivity Growth of the Korean Cable SOs: A Stochastic Frontier Approach
Cable TV in Korea started in 1995 to provide service of multi-channel broadcasting and this marked the beginning of the new media era as well as the initial launching of video subscription services in Korea. Thereafter, new multimedia broadcasting such as digital satellite broadcasting (DSB) in 2001 and digital multimedia broadcasting (DMB) in 2005 were subsequently introduced. At the early stage of development of the Korean Cable TV industry, operators were separately permitted as program provider (PP), system operator (SO) and network operator (NO). In order to minimize the negative structural effects from belonging to specific companies such as the Press, large conglomerates and so on, they were not allowed to have cross-ownership. As first and second SO licensees, 53 metropolitan-centered SOs and 24 provincial-centered SOs were licensed in 1994 and 1997 respectively. Thereafter, Relay Operator (RO) were two times switched to SO for the revitalization of Cable TV through the unification of the laws and regulations in this industry.
KeywordsTechnical Efficiency Productivity Growth Technical Change Stochastic Dominance Stochastic Frontier
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