Google sells Motorola Mobility, Agrees with Samsung on Patent Accord

Two developments in recent days offer a powerful commentary on the future of the global ICT sector, with direct implications for South Korea's leading smartphone manufacturers.
First, as reported in the Korea Joongang Daily, Samsung Electronics has signed a 10-year patent cross license agreement with Google that will prevent the two companies from waging a patent war against one another, a move the Korean tech firm believes will help further isolate archrival Apple. As reported in the Joongang Daily, the agreement that covers “a broad range of technologies and business areas” with Google. The “mutually beneficial agreement” covers not only existing patents but also new patents to be filed by 2023, Samsung said. The deal, analysts say, will help the two companies improve on each other’s weak points: software in the case of Samsung and hardware for Google. But Samsung is also expected to benefit from some of the hardware technologies that Google has worked on in recent years, such as robotics and wearable devices.
The second development was the announcement by Google that it is selling its Motorola Mobility division to China's Lenovo for $2.91 billion.  As reported by Forbes, "Motorola Mobility was Google’s largest ever acquisition at $12.5 billion in 2012. Page says the decision was made because of the “super competitive” nature of the smartphone market. “Motorola will be better served by Lenovo—which as a rapidly growing smartphone business and is the largest (and fastest-growing) PC manufacturer in the world,” Page said today. “This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere.” The sale doesn’t mean that Google isn’t interested in making hardware to run Android. Earlier this month, Google spent $3.2 billion to acquire smart thermostat maker Nest and bought several robotics companies last year. Page made a point of noting that Google’s vision for smart devices like the Nest and Google Glass, its Internet-connected eyewear, remains a focus for the company."
The most immediately apparent implication of this move for Korea is its impact on the nation's smartphone manufacturers, led by Samsung and LG.

Samsung and Google agree to share patents

There is a lot of news coverage, as rightly there should be, about the signing of a patent sharing deal by Samsung and Google.  The significance of this agreement lies in the fact that Samsung Electronics is an electronics manufacturing and exporting powerhouse while Google is arguably the world's most important company these days when it comes to software, content and services.
As reported by the Chosun Ilbo English edition,"The latest patent-sharing deal signifies closer ties between the two companies, whose relationship has been amicable and unique. While cooperating in hardware and software where they have an edge over each other, they have also sought to stand on their own feet in the mobile business. Samsung has tried to develop its own OS called Tizen to lower its dependence on Android. Google, meanwhile, has stepped up efforts to roll out its own smartphone by acquiring Motorola. The latest deal allows both companies to emerge from the competitive structure and step up cooperation." This new arrangement, of course, relates to the hurdle Samsung and other Korean companies face to lessen their heavy reliance on hardware manufacturing and export, in favor of strength in software. Working more closely with Google is likely to help, rather than, hinder the efforts of the Korean chaebol.

President Park Geun-hye in Davos on the creative economy

President Park Geun-hye addressed corporate and political leaders last week at the World Economic Forum in Davos.  The theme of her speech, delivered in English, was the creative economy and its relationship to entrepreneurship.  The 3-4 minute segment that I've selected for this post represents her latest public articulation of the nature of the creative economy and its relationship to entrepreneurship and sustainable economic growth.   The full speech is available on the WEF site, YouTube and in other places.  For those of you who don't have time to view the entire speech, I would highly recommend this segment.

"5G Movie in a second": Korea intends to maintain its lead in speed

A few days ago, as reported in a Korean language news bulletin largely translated by AFP,  the Ministry of Science, ICT and Future Planning announced the Korean government's intention to introduce a 5G wireless service fast enough to download a full length movie in one second. "We helped fuel national growth with 2G services in the 1990s, 3G in the 2000s and 4G around 2010. Now it is time to take preemptive action to develop 5G," the ministry said in a statement. "Countries in Europe, China and the US are making aggressive efforts to develop 5G technology ... and we believe there will be fierce competition in this market in a few years," it said. Under the roadmap, a trial 5G service will be rolled out in 2017 and a fully commercial service in December 2020. Priority will be given to developing key features for the new network, including Ultra-HD and hologram transmission as well as cutting-edge social networking services. The Korean language news release specifically mentions implementation of R&D projects in connection with the Pyeongchang 2018 Winter Olympics. A major goal of this project is to make Korea more competitive in the network infrastructure equipment market globally. According to the Future Ministry, Korea currently has only a 4.4 percent share of this market. AFP reported that "Chinese equipment makers including Huawei have expanded their presence in the global market from 12 percent in 2007 to 26 percent in 2012. Huawei announced in November that it was looking at a 5G commercial rollout by 2020, with a minimum investment of $600 million to develop the technology. Seoul intends to take up to a 20 percent stake in the world's telecom infrastructure equipment market by 2020, according to the ministry." This announcement by South Korea's leading ICT-sector ministry is hardly surprising given the nation's track record in recent decades. Many expect Korea to be a major player in development of the world's next generation network infrastructure. However, as noted in earlier posts, the real value to be created by next generation networks will be in the content, services and software that run on them.

Government restructuring and ICT-led innovation in Korea: Telecommunications Policy Article now in press

Those of you with access to the journal, Telecommunications Policy, can now access the full version of my article with Professor Park, Jaemin of Konkuk University entitled "From developmental to network state:  Government restructuring and ICT-led innovation in Korea."  It has gone online as an article "in press."  Elsevier has also published a short slide show which contains some highlights from the article and can be accessed here.   Readers who would like a PDF copy of the "in press" article should feel free to contact me via my online form here.
The article originated as a paper that we wrote for last year's Pacific Telecommunications Council annual conference, PTC '13 in January of 2013.  Subsequently we substantially revised the paper for submission and review by the journal.