Wednesday, April 20, 2016

The vicissitudes of hardware exports

For some months now, the local press in Seoul have commented on the decline in some of Korea's flagship ICT products, notably smartphones and flat screen television sets.  Earlier this month, The Joongang Daily published an article with the accompanying graphic (click for a larger version).  The reasons for the decline in market share are not that difficult to discern and some are noted in the article.  They include competition from companies in China, and Apple, which recently introduced moderately priced phones.  More broadly,  smartphones are modular in nature and quickly become commoditized, making Korea's manufacturers vulnerable to competition from lower cost producers.    As noted in the article, the decline in flat screen television exports is partly driven by the popularity of online and mobile on demand TV services.  Simply put, more people are choosing to watch TV on mobile devices.

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