Apple to use Samsung processor chips in 2015

The news reported yesterday in the Korea Economic Daily is quickly spreading through the trade press.  According the report,Samsung Electronics will supply mobile application processors (AP) to Apple Inc. starting in 2015. The AP constitutes the "brains" of Apple's iPhone. Samsung Electronics will reportedly supply 14 nano A9 chips that will be used for Apple's iPhone 7. Samsung Electronics had supplied the AP to Apple since 2007 but lost the contract to supply 20 nano AP A8 chips to Apple to Taiwan's TSMC last year in the midst of patent disputes with Apple. Samsung Electronics developed state-of-the-art 14 nano models ahead of its rival TSMC, regaining the order from Apple.

Korea's monthly telecommunications expenditures third highest in OECD

The OECD has published the latest version of its annual report, entitled OECD Communications Outlook 2013.  This is recommended reading for those of you following global and regional trends in the ICT sector.

One of the items receiving quite a bit of attention in the local press is the report's data that show South Korean households spend more per month on telecommunications than any other OECD countries except for Japan and the U.S.  The accompanying bar chart is taken directly from the original online OECD report (click to see a full-size version).  The height of the bars represents U.S. dollars PPP (purchasing power parity)  According to this measure, a Japanese household on average spends $160.52 per month on telecommunications, while a U.S. household spends $153.13.   In China, represented by the bar on the far right, a household spent $30 per month as of 2009.
To me, the most striking aspect of this chart, apart from Korea's number three overall ranking, is the proportion of monthly expenditure accounted for by mobile communications.  Not surprisingly, this country is leading the way in the adoption of mobile broadband.

Korea's dominance in the Android and LTE markets

Today I ran across a release by Strategy Analytics reporting on the global share of profits from the sale of Android smartphones.   Before reading this information, I was aware of Samsung's dominance, but did not quite realize the extent of it.  During the first quarter of 2013, Samsung Electronics captured 95 percent of global Android smartphone profits, far outdistancing LG which garnered 2.5 percent of profits. (click on the accompanying graphic to see a full size version.
According to The Korea Herald, based on data from the same firm Strategy Analytics, global sales of smartphones running on the so-called "long term evolution" LTE network are expected to triple this year from a year earlier.

According to The Korea Herald  "Last year, a total of 92 million LTE smartphones were sold, garnering a 13.1 percent share in the global smartphone market, the data showed. Given that LTE services are currently only available in S. Korea, Japan and part of the North American region, the growth of smartphones running on the LTE network is spectacular, market watchers said. South Korea's three major handset makers -- Samsung Electronics Co., LG Electronics Inc. and Pantech Co. -- grabbed more than a 30 percent share of the global long-term evolution (LTE) phone market in the first quarter, earlier data showed."

Slim smartphones, IT exports, and the creative economy

As noted in this blog and in many of my other publications, South Korea leads the world in exports of smartphones, flat screen television sets and semiconductor memory chips.   However, the release by a Chinese company, Huawei, is a sharp reminder that all this may be about to change.  The new phone (click on the photo to see a full-size picture) is only 6.18 mm thick, compared with the iPhone 5 at 7.6 mm and 7.9 mm for Samsung's Galaxy S4.
About a month ago, most of the local and international media took note that South Korea's exports had unexpectedly increased in May, on the strength of smartphone sales.   Actually, as the accompanying graphic (click for a full size version) from the press release by the

Ministry of Trade, Industry and Energy on "IT Trade Figures for May," makes clear, it was not only smartphone exports that did well.  Exports of semiconductors and televisions also showed healthy increases.  The decline in exports of display panels is no doubt related to the decline in the global market for desktop computers, reflected in the graphic under "Computers and Related Devices."  South Korea's export strength in mobile phones, semiconductors and television sets is a trend that has developed over quite a number of years now.
What do the above developments have to do with the "creative economy" proposed by President Park Geun-hye?   Simply that hardware manufacturing, even high-end smart phones, involves products that are modular and rather quickly become commoditized.  China is moving rapidly into that space in the global market, which puts pressure on South Korea to develop strength in software, services and content, rather than continuing to rely on hardware exports.   The pressure is real, especially if we consider the future of manufacturing.
The whole question of how software relates to manufacturing is also worthy of consideration in this age of relatively inexpensive 3-D printers.  I showed my KAIST students a video of the gun that had been printed and successfully fired by the student in Texas.   However, as research by the Center for Bits and Atoms at MIT shows, we are moving toward the era in which it may be possible to manufacture many things on the spot, starting at the atomic level.  Not long ago this would have been thought of as pure Star Trek science fiction.

Korea's broadband networks are faster than Japan's

It would seem unnecessary to do a post like this, in view of the massive empirical data accumulated in recent years to support my assertion.  However, I am continually amazed by the number of highly educated Westerners and others from outside Korea, who think that Japan's ICT sector is more advanced and therefore that Japan must have faster broadband networks than Korea.
The best available measure of broadband speed is Akamai's quarterly "State of the Internet" report, which provides solid data with which to compare the average download speed of the internet across different nations.   The chart accompanying this post is based on 4th Quarter data reported by Akamai (click on it to see a full size version).
To place Korea and Japan in a little broader global context, the second graphic shows average measured connection speed for the top ten ranking countries in the world, as reported in Akamai's State of the Internet report for the fourth quarter of 2012.  (again, click on the graphic to see a larger version)

Of course, assessment of broadband internet involves other considerations such as penetration (the percent of people who have access), household access, price/affordability and so forth.    Even in these areas South Korea ranks at or near the top among national broadband leaders. However, the actual amount of data that can be downloaded per second is what customers will appreciate, anywhere in the world.