Wednesday, December 30, 2009

The iPhone's Impact on Mobile Networks in Korea, the U.S. and Britain

Having spent the past year or more reading the laments of Korea's mobile service providers and others here about low levels of data usage, and knowing that this country probably has more unused 3G network capacity than any other nation in the world, it is interesting to read about the woes of AT&T in the U.S., and now O2, one of the leading mobile service providers in the United Kingdom.
As outlined in a PC World article, O2 in Britain has now joined AT&T in the United States in blaming the "excessive data demands" of the iPhone for crippling the network!   If in fact, the U.S. and British networks are not capable of handling the data load, then Korea, with its advanced and under-utilized networks should be in an enviable situation.   The PC World article does note that some reports suggest that the iPhone itself may be the cause of problems and complaints in major metropolitan areas like San Francisco and New York.
From a consumer standpoint, the best outcome will be to build robust, high speed data networks (WiBro comes to mind here) rather than laying the blame on consumers who happen to like using mobile broadband!

Thursday, December 24, 2009

Korea's IT Growth Slows Since 2005

Citing a report by the Korea Chamber of Commerce and Industry, an article in the Joongang Daily notes that the growth of South Korea's IT Sector has slowed noticeably since 2005.  From 1989 until 2004 the sector grew at an annual average of 16.8 percent, but since 2005 the pace has fallen to the 4 to 7 percent range.  The report attributed the slowdown to three widening gaps.

1. Between software and hardware.  Between 2000 and 2008 the hardware industry recorded annual growth of 9.5 percent, while the software industry grew at an annual average of 7.5 percent.
2. Between finished goods and parts.  The report noted that domestic production of key parts in the IT industry remains weak.
3. Between large and smaller companies.  While the nation's 20 largest IT companies posted an 8.1 percent rise in average annual sales from 2000-2008, sales at smaller firms grew by just 4 percent annually.

Why the iPhone is Faster: Resistive versus Capacitive Touch Screens

Thanks to an informative article in the 전자신문 ( I now understand one major reason why I like my iPhone 3GS.   It is faster than my old Motorola Razr and even faster than other touch screen phones, like Samsung's T-Omnia.   There are two main types of touch screens used in today's mobile phones.  Resistive touch screens, used in most of Samsung's and LG's phones, depend upon the pressure of a finger, or a small stylus.   The capacitive touch screen used by the iPhone, on the other hand, uses the electro static field created by the human finger, allowing faster recognition than a resistive touch screen.  Capacitive touch screens also allow multi-touch functionality, such as using two fingers to enlarge the screen for better viewing of a map, picture or other document.
In a small computer or internet device like the iPhone, customers value speed. Speed matters, as I've touched on in earlier posts.  Now I know a bit about the technology underpinning this speed.   I'd only add that the capacitive touch screen also has a natural feel to it, in contrast to the more mechanical approach of the resistive touch screen, even with haptic effects added.

Tuesday, December 22, 2009

iPhone Sales in Korea: A followup

This morning The Korea Times carried a report that smartphone sales in Korea are expected to exceed 1 million.  That prediction probably needs to be at least doubled, especially since I've predicted in an earlier post that Apple iPhone sales alone will probably reach one to two million.  According to my recollection, in the period before the iPhone was introduced, well over one million Koreans purchased the iPod Touch, and it is a safe guess that the vast majority of these people will prefer the iPhone.

Monday, December 21, 2009

Fixed-mobile convergence and the Role of Wi-Fi in Korea

Now that the iPhone is available in the South Korean market, the media are beginning to discuss a number of issues.  One of the interesting ones is the role of Wi-Fi in the continuing convergence of digital media.   As noted in The Korea Times this morning, mobile carriers in Korea had considered Wi-Fi more as a threat than an opportunity, even blocking handset vendors from including the wireless broadband functions on their devices over worries about losing data traffic or voice minutes.  SK Telecom, in particular, has been criticized by users for years for forcing Korean handset vendors Samsung Electronics and LG Electronics to exclude Wi-Fi from phones offered to its subscribers.
Now, things seem to have changed and SK Telecom is considering new ways to incorporate Wi-Fi access into its service offerings.  I'll say things have changed!  They began changing nearly three years ago with introduction of the iPhone.  The significance of the iPhone is not as a "smart phone" but rather that it begins to utilize various applications made possible by mobile broadband.   Until the full build-out of WiBro and perhaps LTE networks in Korea, (and even after that) Wi-Fi plays a very important role in the mobile broadband picture and in so-called "fixed-mobile convergence."  KT seems to recognize that with the iPhone and the manner in which it is leveraging its NESPOT network to sell the iPhone in Korea.  Let's hope that SK Telecom and LG Telecom follow that lead.  

Sunday, December 20, 2009

Communication and Korean Reunification

Andrei Lankov's September Op-Ed piece in The New York Times, entitled "Changing North Korea," deals with a topic I addressed in Chapter 9 of my 1995 book, The Telecommunications Revolution in Korea.  That chapter is organized around the two fundamental realities of the information revolution in South Korea as they relate to the overarching problem of national division.  The first is the control of the media and the flow of information into and out of North Korea for political purposes.   The second is the growing disparity in information infrastructure between North and South.  These two factors taken together present North Korea with an enormous dilemma.  Developing modern digital networks inevitably weakens control over the information that reaches the people, while the effort to maintain strict control over information flows will inevitably inhibit the development of a modern communications infrastructure.
Under present circumstances, Lankov is undoubtedly correct in suggesting that change will have to come from the North Korean people themselves.  He notes that "Aware of their vulnerabilities, North Korean leaders have taken information control to extremes unprecedented even among Communist dictatorships."   Lankov's key suggestion is that "To crack Pyongyang's control over information and bring about pressure for change from within, truth and information should be introduced into North Korean society."   Obviously, I agree.  This is essentially what Professor Johann Galtung suggested in a 2008 lecture in Pusan (see my earlier post).
As Lankov warns in his Op-Ed piece, the United States, South Korea and others should be aware that there are no "quick fixes."  Engaging in dialogue with North Korea, encouraging exchanges, and disseminating information will only have an effect over time.   The recent growth of a digital mobile telephone network in North Korea is an encouraging sign, especially if one assumes that the development and use of modern digital networks enhances the prospects for information flow in and out of North Korea.  The evidence, if one looks at how North Koreans used Chinese mobile networks, seems to suggest that is the case. (See my September 2 post)

GE Global Ubiquitous Health R&D Center to be Established in Incheon

The Incheon Free Economic Zone (IFEZ) and the GE Healthcare and Bio Research Complex (BRC) have announced the signing of a five year plan to establish the GE Global Ubiquitous Health R&D Center in Incheon.   Under the agreement, GE Healthcare, a global leader in transformational medical technologies and services and BRC, a respected provider of gene analysis technology, will use the facility for research and development activities related to healthcare IT solutions.
GE has made a $6 billion dollar commitment, named Healthymagination, to the improvement of health care access, affordability, and quality through advanced technologies and R&D.  The Korean government and the IFEZ see the center as an opportunity to gain advanced clinical knowledge, build professional skills, and create jobs through healthcare IT, which is a mainstream green industry.  For a more detailed report, see

Saturday, December 19, 2009

Korean Cyber-Warfare

The Korean War may have ended in an armistice, but it seems to be continuing in cyberspace.  The latest evidence of this is in press reports that the South Korean-U.S. joint war plans, referred to as Operation Plan 5027, may have been hacked.  According to The Korea Times, the Defense Ministry announced that computer hackers who may be from North Korea might have gained access to this secret plan.
The Chosun Ilbo reported that an officer with the U.S.-Korea Joint Forces Command had used an unsecured USB memory stick and that, in the process, some contents of the secret plan were accessed by a hacker with a Chinese IP address.  North Korea is believed to have military personnel who specialize in hacking.

Strength in Software/Content Versus hardware: The E-Learning Initiative

The Korea Times yesterday carried an article on the government's new e-learning initiative that sheds some light on the importance of content and software in driving the use of digital devices.  Reportedly, the Ministry of Education, Science and Technology has spent about $255 million to install electronic blackboards or interactive monitors for showing electronic content in 256 middle and high schools across the country.   The article notes that, according to critics, these screens are not seeing much use yet, because of the absence of appropriate electronic content.
Converting whole textbooks into digital content and using it in classrooms would be considered illegal under current rules, so teachers are limited to using excerpts from the texts.
The overall project also calls for the provision of e-book readers to a 110 schools in rural areas of Korea, but the government says it will not spend more than 1.1 million won for each device, while the companies involved in the project say they cost more.
There is always a balance to be struck between the provision of digital networks and equipment to be attached to the networks, on the one hand, and content or applications, on the other.  Although there is currently controversy over the e-learning initiative, the story is far from over.  

Apple Envy at Samsung Electronics?

An article in Business Week suggests that Apple-envy may have been a major factor in the recent personnel shakeup within the Samsung Group.  The company Choi, Gee Sung, the head of its TV and cellphone business as CEO, replacing Lee Yoon Woo.  It also created a new position, that of chief operating officer, for Lee Jae Yong, the only son of former chairman Lee Kun Hee.
Some Samsung-watchers have a one-word answer for why the company made these changes now:  Apple.    For all of its success in consumer electronics, the company is an also-ran in the battle to win customers away from Apple's iPhone.  Park Kyung Min, chief executive of fund manager Hangaram Investment and a longtime watcher of Samsung noted that "Samsung must have taken a whopping blow from the revolutionary popularity of the iPhone.  To emulate Apple it needs a new start."
Until now, Samsung electronics success has come largely from the development and worldwide sale of electronics hardware, led by semiconductors, flat screen displays and televisions and handsets.  According to Business Week, the new management team will try to refocus the company on total solutions, including creative software.  After all, the Apple iPhone is a beautiful and efficient piece of hardware, but everyone knows that its real worldwide popularity lies in the software applications available through its App store.  The Apple iPhone is really just the first of a whole generation of hand-held computers and internet terminals.  The new Android phones will emulate the best features of the Apple iPhone and eventually these handsets will be come commodities, just as desktop or notebook PCs did.  Perhaps Samsung should envy Apple, but not for its hardware, but rather all of the very useful internet and iPhone based applications that people love to use!

Friday, December 18, 2009

Mobile WiMax (WiBro) Development and Exports

It is about time to review the success of Korea's home-grown mobile broadband technology, at home and in export markets.   It is called WiBro (short for Wireless Broadband) here in Korea and Mobile WiMax in other countries around the world.  It is based on the IEEE 802.16e standards and subsequent updates.
First, regarding the South Korean market, it seems a safe bet that WiBro-equipped mobile handsets will be very popular and widely used here, now that the mobile broadband market has been opened up.  People using the iPhone, Android phones or other mobile broadband-equipped handsets will place a high value on speed.  WiBro delivers speed and does so dependably.
In terms of exports, WiBro has expanded its international presence in recent months.  The WiMax Forum has announced a long list of companies backing the building of a mobile WiMax ecosystem, including Cisco, Intel, Samsung, KT, Motorola, Yota and others.  The Forum reports that wireless broadband internet deployments based on WiMax have reached 519 in 146 countries, including 95 WiMax networks deployed by 2G network operators.
Samsung announced earlier this week that it will launch its next generation mobile internet service with its Russian partner Yota in Nicaragua, starting in May.   Also earlier this month, Korea Telecom launched WiBro service in Rwanda, marking the first deployment of the technology in Africa.  The initial deployment was a wireless network for government offices in the capital city of Kigali.  According to press reports, SK Telesys, the SK group's mobile communication equipment group has exported WiBro to Jordan.  KT is providing WiBro services to Uzbekistan, and the list continues to grow.  As of September 2009, Samsung alone had provided Mobile WiMax equipment to 25 operators in 21 countries.

Korea's "Smart Grid" Plans

South Korea plans to be the first country in the world to convert its electricity network into so-called "smart grids," as noted by a story in The Korea Times.  Korea plans to implement its high-tech nationwide electricity grid by 2030, at a projected cost of $23.3 billion.  The new grid should help the country reduce power consumption by 3 percent and cut greenhouse gas emissions by about 150 million tons.
A smart grid links electricity suppliers with consumers in an IP-based network.  Many countries are striving toward the goal of having smart grid technology.   Stakeholders in the United States have identified the following performance characteristics of smart grid technology.

  • Self healing from power disturbance events.
  • Enabling active participation by consumers in demand response.
  • Operating resiliently against physical and cyber attack.
  • Providing power quality for 21st century needs.
  • Accommodating all generation and storage options.
  • Enabling new products, services and markets.
  • Optimizing assets and operating efficiently.
A simple example of how the smart grid will work is that it will allow home or apartment owners to schedule their washing machines or other appliances to run when electricity rates are lowest.  This is the same principle as the "night-rate electricity boilers" that are so popular for ondol heating systems and hot water in Korea.  The smart-grid will be accessible from both mobile and fixed broadband internet, so people could be able to make adjustments to their home appliances via a mobile handset.
Residents of Jeju Island will get the first glimpse of the possibilities offered by smart grids.  KEPCO and 167 other companies are collaborating to build the nation's first smart-grid test bed

Monday, December 14, 2009

The Google Phone and AT&T: Implications for Korea

The New York Times this morning has two articles with direct implications for the evolution of the mobile communication market in South Korea.  The first of these is about the forthcoming Google Phone.   According to the report, Google plans to begin selling its own touch-screen Android phone early next year, a move that could challenge Apple's leadership in this market segment.  The company plans to use its brand power to market the phone directly to consumers over the internet.  Customers could then sign up for service with any compatible provider.  According to Google employees who spoke on the condition of anonymity, the new phone will be manufactured by Taiwan's HTC and will be thinner than Apple's iPhone with a slightly larger touch screen.  The phone has already been distributed to Google employees so that they can try it out with different service providers and applications.
Not surprisingly, analysts are reporting that Google sees mobile as its next big opportunity, and it wants more control over its destiny in this new environment.  Google wants more people using web-friendly phones in part because its advertising revenues come from this source.
Some of the implications and questions for Korea are rather obvious.

  • Which mobile service provider(s) will offer the new Google phone?
  • When will it be introduced into the Korean market?
  • At what point will Korea's wireless networks begin to feel the effects of rising data usage, as AT&T is in the United States because of the iPhone?  (this is the subject of the second NY Times article.)
  • How quickly will the use of these palm-held computers (iPhone, Google Phone, Android phones) spread in Korea?  I'm on record as predicting an extremely rapid diffusion!
  • What will the arrival of the mobile broadband, handheld internet device era mean for data rates and subscription plans here?

Sunday, December 13, 2009

Mobile Communication in North Korea

There was an interesting article in the English edition of the Chosun Ilbo that noted the rapid spread of mobile phones in North Korea since the government there established a joint venture with Orascom in December of 2008.  In just eleven months of service, the number of subscribers exceeds 70,000 and it appears that number will reach 120,000 by early next year.  Although these numbers exceed the published expectations of Orascom, in learning about them one cannot help but think of the deep and growing digital divide between North and South Korea.  Other thoughts that come to mind are that the North is just now introducing 3G WCDMA service (as shown in the image in the upper left-hand corner of this post---click to see full size), while in South Korea mobile broadband is set to explode via the iPhone, Android phones and competitors.  Of course, if North Korea were to allow mobile broadband on a widespread basis, it would completely undercut several of its basic policies, by allowing the populace access to information from the outside world.  These are some of my thoughts.  While most of the world focuses its attention on the six-party talks and North Korea's nuclear program, it seems that the fundamental problems of information infrastructure and their implications deserve at least as much attention.

Friday, December 11, 2009

I'm officially an iPhone User: Some Initial Reactions

On Wednesday of this week I purchased an iPhone and stopped using my older Motorola Razr.  I had debated for weeks whether to wait and see what kind of Android handsets Samsung and LG would come out with next year.  Also, I knew that Motorola's Droid would be available in the Korean market early next year, probably in January.  However, I have no need whatsoever for the slide-out physical keyboard.  It strikes me as an appendage from an earlier age in the evolution of digital communication.  So, after two days of using the iPhone (3GS, 32 GB) here are some of my reactions.

  • It is a handheld computer or PC, more than a phone.  There is no single "killer" application.  What makes it so wildly successful is that it brings broadband to your palm.
  • The screen resolution is great.  I had debated waiting for one of the Samsung AMOLED screen-equipped Androids next year, but the iPhone display is so crisp and clear that I doubt I'll experience any buyer's remorse.
  • The touch and multi-touch features on the iPhone are both designed for easy use.  All you need is a clean screen and dry fingers and you can rapidly move through screens, scroll and zoom using only your thumb or a single finger for the most part.  The user interface is elegant, with no extra steps and it is also largely intuitive.
  • Synchronizing:   I was very pleasantly surprised at how fast I could synchronize my contacts, calendar, pictures and other information from my notebook to the iPhone.
The above are some personal reactions.  Using the device for a couple of days has also reinforced some of my thoughts about the Korean mobile market.

  • I'll repeat my earlier prediction that millions, not hundreds of thousands of iPhones will be sold here in the next year or two.  It is a big hit with younger people and we already know that diffusion rates in Korea's closely knit culture can be extremely fast.
  • Samsung, LG and the mobile service providers here need to take a close look at the overall impact and patterns of use of the iPhone, not as an Apple iPhone per se, but rather as a breakthrough device, similar to the first PC, and the first GUI or mouse.   A sea-change is taking place in mobile communications worldwide, and Korea has some catching-up to do.
  •  In the past, Korea has shown its ability not only to catch-up, but then to go out in front of other countries in the ICT sector.  For the long run, don't underestimate what this country's leading companies may accomplish in mobile communications!

Tuesday, December 8, 2009

Seoul Video Contest: "Streaming Seoul 2009"

This post is to call your attention to a very interesting and worthwhile video contest being sponsored by the City of Seoul called "Streaming Seoul 2009."   Click on the title or here to access their web site.  The contest is open to all, regardless of nationality, but there is a particular interest in how people from other countries and foreigners residing in Seoul experience and view the city.
Those of you who follow this blog know that I've long been concerned with questions surrounding national image and brand image, whether that be for a city, a corporation or another sort of organization.  Of course, this blog also concerns itself with developments in mobile communication.  One part of the big transformation taking place is the growing ease with which video can be recorded and shared with others via the internet.
I notice that the deadline for submissions to the contest is December 31.  That leaves just over three weeks for videophiles to shoot some video and put together a potential prize-winner.  The contest offers cash prizes for several categories of video.
My personal thanks to Danny Taewoo "Technokimchi" Kim for calling this contest to my attention.

Friday, December 4, 2009

"Korea has not yet begun to develop its mobile technology":Google's Expansion Plans

The Joongang Daily carried a brief report today about Google's expansion plans in Korea.   It noted the changes that Google is making to its home page.  I discussed this in an earlier post that referred to Google's plans to "Koreanize" its home page.
What really caught my eye about this latest article is the quote at the beginning, "Korea has not yet begun to develop its mobile technology."  As readers of this blog will note, I agree with the basic sentiment expressed by this quote.  As Cho Won-gyu, the head of Google Korea's research and development suggests, with the introduction of more smart phones next year, Korean consumers will begin to learn about many broadband internet applications from which they have been shielded to date.  Take for example video.  Although Youtube is now the most widely used video service in South Korea, it is not yet widely used on mobile phones.  Now that the iPhone is already here and numerous Android phone models are coming next year, that is about to change.  Given Google's strong array of web-based information services and their availability in Korean language versions, it is not too difficult to predict what will happen in Korea's mobile market next year.  Google will gain market share for all of its internet services, as Korea's customers become acquainted with them via the new Android phones that will probably come to dominate the mobile market here.

Wednesday, December 2, 2009

How Well will the iPhone Sell in South Korea?

A report by the Japanese investment bank, Nomura, is now suggesting that Korea Telecom could sell more than 700,000 units of the Apple iPhone next year, on the assumption that 10 percent of KT's new subscriptions are driven by iPhone demand. It seems that this prediction is based on the lively reception of the iPhone thusfar. I stand by the predictions I made in an earlier post, that the iPhone will sell millions over the next year ( I should clarify that to say 1-2 million iPhones). The Nomura estimate fails to take into account the rapidity with which mobile communications worldwide are becoming internet and cloud-computing capable. Nor, I think, does it account for the power of old fashioned word-of-mount communication in Korea, that is leading to a possible Apple iPhone mania here.

The iPhone Effect in South Korea

There is rather widespread reference these days to the "iPhone Effect," following the introduction of the Apple iPhone to the Korean market.  An example was yesterday's article in The Korea Times about the customer service war heating up between KT and SKT.    The article notes that, "triggered by this import" SK Telecom plans to introduce Android-powered handsets early next year.  It also notes that the introduction of the iPhone is "leading a new trend."
It is being called the "iPhone effect" because the iPhone got here first.  However the trend toward mobile handsets as internet-capable handheld computers has been apparent for several years now.  If the truth be told, it would be better to characterize the overall effect on South Korea's mobile market as the "Android effect," since that is likely to be broader and more sustained than the iPhone, which has its own built-in limitations.

Tuesday, December 1, 2009

Korea Joins Top Ten Exporting Countries, Led by ICT Sector

There has been a great deal of commentary in the local media lately about the performance and goals of South Korean exports. The country has broken into the ranks of the top ten exporting nations in the world, with total exports valued at about U.S. $260 billion. and it has done so during a global economic crisis and with ICT-sector exports leading the way. As reported in the Korea IT Times and other media, it appears that three of the four top spots in Korea's exports this year will be IT products. These are cell phones, semiconductors and display products including digital LCD televisions, which rank, which rank second, third and fourth on the list of Korean exports, following vessels (the shipping industry). The last year that three out of the top four exports came from the ICT sector was 2004.
Perhaps more important than the ranking of these major product categories is their total value, which this year will account for almost 25 percent of all Korean exports. Also, display exports showed a greater percentage increase relative to cell phones and semiconductors. The reasons for the increase in ICT exports are different for each of the sub categories. For example, exports of displays (including television sets) skyrocketed after the introduction early this year of the new LED backlit models. They represented a breakthrough from the older models, being much thinner, lighter weight and lower in energy consumption. In other words, they were a breakthrough technology in the marketplace that made all of the competing products seem old fashioned. On the other hand, the increase in cell phone handsets, while reflecting consumer preferences for Samsung and LG products around the world, was not based on significant increases in the rapidly emerging "smart-phone" segment. This has been the subject of other posts and should be of great concern to Korean exporters. Especially since the worldwide transition in mobile communications is clearly toward hand-held computing and internet devices. It is a transition that will perhaps be more important than the arrival of personal computers three decades ago.