Samsung (and LG's) Relationship With Apple

The introduction of the Apple iPhone, followed by Android devices was a boon for South Korean electronics manufacturers, led by Samsung and LG.  However, as noted by an article in the Joongang Daily, the relationship with Apple poses somewhat of a dilemma for the Korean firms.  As Samsung and Apple products go toe to toe in the global market, the two companies are now more dependent upon each other than ever before.

Samsung has never specified which parts it supplies to Apple. But when consumers disassemble the iPod, iPhone, and iPad, Samsung’s A4 central processing unit, NAND Flash, DRAM, and liquid crystal display panels are there in plain sight. Industry sources also say Samsung is in the running with LG to become the main display supplier for the second version of the iPad. Apple will place an order worth of $7.8 billion in parts for future productions.

As for the iPhone 4, Samsung parts account for 27.5 percent of the device, which amounts to $187.51 per iPhone, according to iSuppli, a research firm.

As shown in the accompanying graphic (click to see a full size version) Apple remains far ahead of Samsung in the global market.  With the growing strength of Android devices in the world market, it will be interesting indeed to watch the shifts taking place in market share.

Notes on Samsung's 9 Series Notebook

The first notebook computer I ever used was a bulky (by today's standards) Toshiba which, at the time seemed like a great upgrade from the IBM PC I was using in the office.  Over the years, notebook or "laptop" computers have gotten steadily smaller and sleeker.  About eight years ago I purchased a Samsung X-10 multimedia notebook and have been using Samsung notebooks ever since with few problems.  Consequently, I take note when Samsung comes out with a new series or model.

According to PCWorld, the new Samsung 9 Series Laptop "Out-Sleeks Apple's MacBook Air."  According to the article, it is slightly thinner and lighter than Apple's notebook (0.64 inches thick versus the MacBook Air's 0.68 inches; 2.89 pounds versus 2.9 pounds),has more memory (4GB versus 2GB), and is made of aircraft-grade Duralumin material (twice as strong as aluminum). It boots Windows in under 20 seconds, has 160-degree viewing angles, and otherwise seems tailored for premium laptop users who care about both form and function.

Sounds very nice and these new products will make the choice between a notebook and a notepad touchscreen device very interesting for many consumers in the months to come.

Korea Leads World in Mobile YouTube Viewing

As I predicted in a December 2009 post, viewership of Youtube video on mobile devices has skyrocketed in South Korea.  An article in the Joongang Daily notes that more Koreans now watch YouTube on mobile devices than do people in any other country around the world.  On the third anniversary of YouTube's launch in Korea an executive of that company noted that mobile views grew nine-fold last year.  He also noted that YouTube is now being used to deliver Korean content, including popular soap operas, to a global audience.  YouTube Korea has signed partnerships with Korea's top three talent agencies, under which the agencies provide premium content for YouTube, while YouTube provides them with useful information such as the number of viewer hits.

A Note on Broadband Availability in the U.S. (Guam)

I just returned from a pleasant three night vacation trip to Guam.  The weather was pleasant and the palm-lined beach and warm Pacific waters were beautiful.  However, I cannot offer the same compliments about the broadband internet service.

The night before our departure to Guam, we stayed in a small motel in Gangnam in order to be ready for a morning departure from Incheon International airport.  As is common in Korea these days, the motel offered an extensive array of cable television channels and had a computer installed on the desk with an LCD monitor and fast internet access, all included with the modest price of the room.

On arrival at the hotel in Guam (one of the major hotels on Tumon Bay), we plugged the internet cable into our notebook computer, only to be greeted with a page informing us that internet access would cost $10 per day via the cable or $5 per day if we chose to use one of the available wireless channels.  Clearly, we had left Korea and were in the U.S.

Mobile Broadband is the Future

There is some interesting news these days out of the recently concluded World Mobile Congress in Barcelona.  Samsung and the other major manufacturers of smart phones have announced plans to release cheaper smart-phones that will be accessible to the masses of users around the world.  This is hardly surprising since the general logic of the digital information revolution is that semiconductors, screens and other modular devices continue to become more powerful and cheaper over the long run.

Eric Schmidt of Google gave the keynote speech in Barcelona.  As he noted in a recent article for the Harvard Business Review, we are on the cusp of a big mobile revolution that requires three developments.

• Development and deployment of fast mobile networks for the future services.


• Development of mobile money, and


• Increasing the availability of inexpensive smart phones in the poorest parts of the world.

Renewable Energy Exports and Korea's ICT Sector

What does renewable energy have to do with Korea's Information Society?  The answer is partly provided by an interesting article in the Joongang Daily this morning, entitled "Renewable Energy Sector Booms, but also Lags."  According to the Knowledge Economy Ministry and Solar & Energy, total sales in the local renewable energy market reached $7.2 billion last year, a 58 percent surge from the previous year.  Exports jumped 77 percent to $4.5 billion, mainly boosted by demand for locally made solar power generators and related equipment.  The number of firms and employees in the renewable energy sector increased accordingly.   A Ministry official, noting that the renewable energy sector consists mainly of three sectors --solar, wind and biofuel--suggested that “What Korea should focus on is to integrate existing technology from sectors such as semiconductors and liquid-crystal displays with solar power energy, and also shipbuilding with wind power."

Tablets: A New Start in Samsung's Galaxy Lineup?

There is news out of Barcelona about Samsung's new Galaxy smart phone and its new tablet computer, designed to compete with Apple's iPad.  The Joongang Daily covered it, along with much of the trade press.  As shown in the accompanying graphic (click to see full size version), the new Samsung tablet has a 10.1 inch screen, slightly larger than the iPad.  I have long thought that something approximately this size will turn out to be a popular form factor, if it is lightweight enough.   Think of it as a powerful electronic clipboard.  For reading newspapers and magazines, or watching television, the size of these new tablet computers seems almost ideal.  The day is close at hand when many people will carry a smart phone and a tablet computer, both for use at work and on the go, and will choose to use a large or wall-size screen at home.  The ability to synchronize, access and use the same content across all three screen sizes (aka cloud computing) is indeed going to be convenient and commonplace.

Euromonitor on Global Digital Divide: From Korea to Kenya

The Euromonitor blog has a new report on the global digital divide with the accompanying graphic. (click to see full size version).  The measure represented in this graphic is the proportion of households in each country that possess broadband internet-enabled computers.  Nearly all South Korean households do, compared with only about two-thirds of those in the United States.  The report also notes the following main points.

• Access to and use of broadband internet has significant social, economic and political implications.


• While developed economies continue to have a higher rate of broadband internet penetration than developing ones, growth rates are significantly higher in developing regions.

Notably, the report does not deal with the current explosive growth of mobile broadband services via so-called "smart phones."  However, addition of this important factor would only seem to underscore the main points noted above.

Student Recruitment by U.S. Colleges in Northeast Asia

An article in The New York Times caught my eye this morning.   It was entitled "Recruiting in China Pays Off for U.S. Colleges," and there are several reasons I was drawn to it.  First, the story centered on recruitment activities by Grinnell College in Iowa, a small liberal arts school with some strong similarities to St. Olaf College in Northfield Minnesota, where I did my undergraduate study.  Second, the story touched on some issues in student recruitment by U.S. colleges and universities in Asia, an area that was a big part of my responsibilities during the years I worked with the Fulbright Commission in Seoul.

Grinnell is just one of countless American colleges and universities that are seeing an increased number of applications from China, given its booming economy.  As the article notes, this comes at a time when many U.S. schools, especially public universities, are experiencing severe financial difficulties and budget cuts.

One of the issues faced in recruitment of students from China also comes into play in recruitment of students from South Korea to study in the U.S.   As the article notes, many Chinese applicants submit glossy color brochures that contain essays written by or with significant assistance from commercial study abroad agencies.  Along with the role of commercial test-preparation agencies in helping to produce high scores on the TOEFL or other English tests, complicates matters for admissions officers and committees at the U.S. colleges and universities.

The article also notes the importance of recruiting tours of China by Grinnell and other colleges.   By providing an opportunity to meet face-to-face with prospective students and their parents, such tours can help to offset the challenges posed by professionally-prepared essays and English test scores that may be somewhat inflated.

One factor not mentioned in the article is the pervasive new role of the internet in international recruitment.  The rapid convergence of digital media around the internet is opening up a new realm of virtual study fairs, live video conferencing and social networking that is literally re-writing the rules of study abroad recruiting.

Another important factor in college and university recruitment strategies has especially strong relevance for the Northeast Asia countries--China, Korea and Japan.   It is what I originally stated , with Korea in mind, as "Larson's Law on Localization."  The law goes as follows:



To effectively promote a school or other educational products and services in Korea, all key promotional information should be translated into Korean and adapted to local media patterns.

Korea Tops new Government Broadband Index Rankings

The Economist Intelligence Unit has developed a new Government Broadband Index, which shows that Korea ranks number one among the sixteen nations studied.  Not surprisingly, the index is getting attention in the trade press. Using a methodology developed in-house, the index scores countries that have clearly stated objectives on a scale of 1-5 with 5 being the best.  The methodology considers each plan's target speed, universal speed, rollout timeframe, cost and regulatory provisions in order to produce the final score.  Topping the rankings are the countries that have the most ambitious speed, coverage and rollout targets, the most appropriate regulations for realizing targets and fostering a competitive broadband market, and where public funding commitments are putting the least amount of pressure on public-sector finances.  Click on the accompanying graphic to see a full size listing of the country rankings in this study.

Australia was ranked ninth on the list, in part because it plans to spend 7.6% of annual government budgets on the rollout.  Korea, by contrast, plans to spend less than 1% of its budget on the rollout and will instead encourage private sector investment.

3D Smartphones, Yes! 3D Television with Glasses Required, No!

About a week ago I read an article in the Joongang Daily that was completely devoted to a standards dispute between two different standards for 3D television, both of which require that the viewer wear specially-purchased glasses!  It turns out there are two kinds of 3D technology in use:  active shutter glasses and passive polarized glasses.   Read the article if you're interested in further details.

Last year I toured Samsung Electronics headquarters in Suwon with some international visitors and had a chance to personally try out 3D television, with and without glasses.  I will go on record here and now, predicting that any 3D television technology that requires the use of glasses will likely be a non-starter in the global market and may serve a small niche market at best.  For the reasons why, ask anyone who has worn glasses and think about how this relates to the television viewing experience, especially when a person is out of the home or office, and "on the go."

Consequently, I was very interested to read in the Chosun Ilbo that LG Electronics is set to debut a 3D smartphone at the 2011 Mobile World Congress in Barcelona later this month.   It reportedly allows a viewer to see 3D content without glasses, at a distance of 30-50 cm from the screen.  Now this is a technology that makes sense and will seem natural to users.  Expect to see 3D television become popular on smart phones and small devices, long before it (at least the type that requires glasses) hits the big screen.  If you have good arguments against this scenario, I'd like to hear them.

Orascom Comments on Investment in North Korea's Mobile Network

I commented late last month on the meeting that North Korean leader Kim Jong Il had with Naguib Sawiris, Chairman and CEO of Orascom Telecom.  Today an interesting article in The Sydney Morning Herald by Eric Ellis, gives some insight into how Sawiris views his company's investment in North Korea.  Ellis interviewed Sawiris in Egypt in early January.

Orascom, the article noted, is a classic example of a company where the sum of the parts is greater than the whole.
Like North Korea, where the value of the Koryolink JV "is either zero, or $5 billion. If there is reunification, then I will be the incumbent of North Korea, and my value will be something like [South Korean carriers] SK Telecom or Korea Telecom," Sawiris said.
"If there is a war and they unify after the war, it is still the same, depending on who wins, of course. And if they take the asset, then it is worth zero. There is no between value [in North Korea] because who will buy? No one else has the relationship that we are building there."

Android and Korea's Handset Makers

There is new evidence that Android will become the dominant mobile platform worldwide, if present trends continue, and this has a powerful effect on Korea's handset makers, led by Samsung and LG.  As reported in The Wall Street Journal and shown in the accompanying graphic (click to see full-size version) shipments of Android-based smartphones surged sevenfold year-on-year in the fourth quarter giving Android a 33% share of the global market.  This year HTC, Samsung and LG Electronics, all of which made late entries into the smartphone market, plan to further their push with the introduction of new Android models in order to meet lofty sales goals.  Samsung reached its goal of selling 20 million smartphones in 2010 and more than 50 percent of those models were Android-based.  LG showed improved sales results from its Android-based Optimus One handset, selling three million units since its launch in the second half of last year.

College Graduate Unemployment Hits Ten-year High

As reported in The Korea Times, data compiled by Statistics Korea show that the number of unemployed college graduates rose to an all time high last year, despite the faster-than-expected economic recovery.  The pattern of unemployment among college graduates over the past ten years is shown in the accompanying graphic (click to see a full-size version).  Finance ministry officials noted that there is a wide gap between employers demands and college graduates expectations for the level of their jobs.  They also noted that there is a structural problem in the job market--college graduates favor larger companies rather than smaller ones, while the number of jobs available at the former is limited.  Obviously, the growth of one-person enterprises spurred by the popularity of the iPhone and Android phones in Korea, as noted in an earlier post, has not yet had impact on overall employment statistics.

To solve these problems with the jobless growth among the well educated young, the government is seeking ways of restructuring college systems and improving job education programs for students. To promote the restructuring of college and universities, the government will encourage schools to make public the employment rate of their graduates, as well as support active merger and acquisitions of poorly managed schools,a ministry official said.