Telecommunications in Korea
Since the introduction of mobile telecommunication services in 1984, the Korean market has grown at a remarkable pace exceeding 50 million service subscribers by 2010
Since the introduction of mobile telecommunication services in 1984, the Korean market has grown at a remarkable pace exceeding 50 million service subscribers by 2010. The 2010 Korea Statistics census reported a total national population of approximately 49 million, meaning Korea’s mobile penetration rate has surpassed 1 mobile phone per person (this figure includes those with limited access to technology, children, etc.).
The speed of smartphone dissemination was unprecedented. In the second half of 2009, the release of iPhone in Korea initiated a full-fledged smartphone market which grew to approximately 28 million smartphones (approximately 50% penetration) by mid-2012. The introduction of smartphones created an upheaval in the IT market resulting in the collapse of traditional telecommunication companies’ ‘walled garden’ system. Players from a much wider spectrum of industries were stimulated to utilize and engage in the telecommunications business. Banks and securities companies launched smart banking and retailers invested heavily to secure a position in mobile shopping. Kakao Talk, a Korean mobile messenger service launched in 2010 has secured a remarkable 50 million users in just 2 years. Similarly, the social commerce market, which also began in 2010, grew from a 50 million USD market to 2 billion USD in less than 3 years.
The borders of telecommunication are no longer clearly demarcated. Development of diverse over-the-top (OTT) services - contents providing services from non-traditional telecommunication and broadcasting third parties - have threatened the traditional players, but created added value for consumers. Samsung’s Smart TV, Kakao Talk, NHN’s Line and other messaging and mVOIP services represent early signs of expanding OTT services and finance is no exception. Changes in the payments market due to the utilization of NFC technology can be observed countrywide. The publications and education markets have also adapted to the increasing number of Tablet PCs and it has become increasingly difficult to maintain a competitive edge relying solely on traditional methods.
The internet continues to transform industries and individual lifestyles as it develops. Similarly, the evolution of the Korean telecommunications market has initiated a convergence of diverse industries to offer unique ideas and services, making previous ways of existence obsolete. The geography and borders of industry have become blurred and a company’s competitive edge can be defined by its ability to attract consumers, providing not only their desired values but that which will be desired in future. Differentiating between friends and foes is becoming irrelevant in order to create innovative values. Yesterday’s friend can be today’s enemy and equally, a foe can become an ally. Consumers are the answer.