Before my career as a consultant and the founding of my firm, Korea was already on the move in the IT field. How the success story began may interest you.

James Larson, author of various boos concerning Korean Telecommunication sector, has released his early works on the birth of digital Korea under CC License. Hereafter you will find “The Telecommunications Revolution in Korea” (New York, Oxford University Press, 1995 ) covering the 1980s and beginning of 1990s

Enjoy the read !

If after it you want to know the future of Korean TMT sector, please feel free to contact me.

On 12th March, ‘&TV Communications’ launched ‘Enjoy and TV’ to serve Korean Americans in the US. This was the first attempt for Korean IPTV player to provide its service outside its territory. Considering the nature of internet service, where the national boundary doesn’t exist, Korean IPTV (also an internet based service) was supposed to go to overseas market much earlier.

As a matter of fact, Korea’s leading IPTV service providers, which were backed up by their cutting edge IP technologies, have been stuck in their domestic market for the last couple of years. On the other hand, it was &TV Communications (a joint venture between less known players such as Posdata, Celrun, JEI EDU and Acanet TV) who penetrated global IPTV market for the first time. What’s the story behind it?

In Korea, viewers lost their freedom of choice when it comes to IPTV service subscription. The choice of IPTV service depends on selection of their internet connection service. In other words, viewers can subscribe IPTV service that is provided by the same internet service provider. For example, KT and LG DACOM have provided their IPTV services exclusively to their internet service customers. However, SK Broadband behaved in the different manner. They expanded their target market to the subscribers of other internet service providers. KT and LG DACOM complained about this and finally closed their network with the reason of heavy network capacity. The Telecommunication Committee found this was against the benefits and welfare of citizens and thus asked KT and LG to open the network. They also requested SK to pay for interconnection fee to KT, LG and other MSOs. However, after the event, SK has been focussing on selling bundled products, i.e. they try to sell their IPTV and internet connection service together.

Outside the Korea, when SK Broadband launched its Broad & TV (IPTV) it was so popular among overseas Koreans and other Asian Korean drama lovers. They bought set top box from Korea and brought it back to their home countries. They could watch Korean drama and TV shows without the time delay. However, the Korean broadcasting companies began to complain this time. They disagreed with this because it might harm their profit from selling TV contents to overseas markets. Ultimately, SK closed IP network for the access from outside the Korea. Korea’s IPTV service, with huge potential in the global market, never went beyond its national boundary. It is a shame for Korean IPTV sector because they could have penetrated global market if they could cooperate together. Of course cooperation isn’t easy but not impossible.

Microsoft and its Xbox-360(a sophisticated game machine with internet access function) probably provide some lessons to Korean IPTV players about the cooperation. They lately signed partnership agreements with NBC Universal, Walt Disney, MGM Studio and Showtime Network etc for the contents provision. Microsoft currently limits their market within the US due to the copyright issues. However, their well functioning partnership not only makes us feel jealous but make us hope Korean IPTV sectors to learn something from them.

.

Original article written in Korean:

The world’s first Mobile TV, SDMB, was launched in 2004 followed by TDMB in 2005. Mobile TV was expected to make ‘Mobile Broad Casting’ popular and thus people were watching on how it went. Especially, T-DMB penetrated into Saudi Arabia, Norway and Vietnam and still in progress.

While it is globally expanding, Mobile TV in Korea seems getting unsuccessful. - Even though subscriber are increasing in Korea, players are in the red for their business.

DMB subscribers and viewers are increasing as above and ETRI forecasted that DMB viewrs in Korea will be more than 30 million by 2012. However DMB providers still cannot make money from their business since they started DMB service in 2006.

What causes this situation?

1. Weak revenue model
TDMB is soley based on Advertising revenue, and the growth is sluggish. Because of small viewer base, it is unattractive medium for the advertisers. Additionally, KOBACO, the public organization that distributed all broadcasting ads in Korea, applied the same assessment criteria for TDMB. Only for a few cases, TDMB could qulify for the stardards.

2. Poor contents
Mobile TV is a personal media, for which viewers watch only in specific situations such as in the subway etc. But the TDMB players are mostly terristrial broadcasters and thus only try to re-transmit their used contetns without producing new contents for DMB. Smaller players tried to produce contents exclusive for DMB but failed to achieve the economies of scale. This in turn failed to allure more viewers and showed vicious circle.

3. Slow advance
TDMB tried to generate additional revenue from TPEG(the convergence service with navigation) and interactive shopping service. It can’t be achieved by themselves but need partnership from other players such as telecom, homeshopping, etc. But each party pursued their own interests and thus the business advances so slowly.

Media business by its own nature cannot get into stable phase so quickly, and we should not judge so hastily.
But unless the players and regulatory make the wise solution for those problems, we may not see the ’successful mobile TV’