Korea Continues to Dominate the Global Television Industry

Exports of television sets continue to thrive in the information age, and South Korean companies are a dominant force in the world market.   According to The Korea Herald, about a third of all television sets sold around the world in the first quarter of 2011 were manufactured by Korean companies.  (See the accompanying graphic---click to see full size version.)  Furthermore, Samsung and LG both saw year-on-year markets share increases, while the shares of their Japanese competitors decreased slightly.

Samsung's Dominance in the Display Industry

The proliferation of displays of all sizes is one of the salient features of the emerging 21st century information age.  Mobile displays are a particularly important feature of this development, as smartphones become increasingly cheaper, more powerful and popular all around the world.  The accompanying illustration (click to see a full-size version) shows a flexible active matrix organic light-emitting diode (AM-OLED) display that Samsung sees as a major growth engine.  As reported in The Korea Times, Samsung Mobile Display (SMD)  was launched in January 2009 with an aim to lead the market in next-generation flat-screens (OLED) as Samsung was seeking breakthroughs in that area.
SMD is dominating global demand for AM-OLED, which requires less power and provides clearer picture quality and a much faster response time than existing LCD displays. OLED screens are used in smartphones and other portable devices and SMD controls over 80 percent of the market, as shown in the graphic below. (click to see a full-size version)

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."

Korea's First Half IT Exports Set a New Record

The Joongang Ilbo reports today that Korea's IT exports are at record-setting levels.  The graphic accompanying this post shows the recent pattern (click to see a full-size version).  Not surprisingly, semiconductors and flat panel displays are leading the export surge.   Exports of mobile handsets, a traditional Korean export strength during the feature-phone era, dropped 20.8 percent during the first six months of this year, due to a decline in export unit prices and a delay in smartphone production by Korean firms.

The regional pattern is also interesting.  Korea exported the most IT products to China, selling $33.1 billion worth of items in the country, followed by the European Union with $8.99 billion, and the United States at $8.49 billion.

China Looms Large in Display Market

Samsung Electronics and LG Electronics currently lead the world in the manufacture and export of flat panel displays and television sets.   As outlined by the Korea Times today, China looms large for these two companies and for the other major manufacturers of flat panel displays.  After 2012, China is expected to become the world's largest market for displays, outpacing the United States and Europe.  LCD panels are used for everything from mobile phones, to computer displays to television sets.

Samsung is reportedly pursuing a "dual strategy" in the display business, by producing panels that require cutting edge technology in Korea, for export to the U.S. and Europe, while producing other panels in China.    LG Electronics, by contrast, is concentrating on gaining the "first mover" advantage in China by setting up partnerships in that country.  All of the world's biggest LCD panel manufacturers are in Asia, primarily in Japan, Korea and Taiwan.  The number of LCD TVs sold in China is expected to jump 76 percent to reach 23.6 million this year, according to Austin, Texas-based DisplaySearch. With Samsung and LG Display, Taiwan's Chi Mei, Japan's Sharp and China's BOE Technology are set to build advanced eighth-generation plants on the mainland.

Sales of Digital TVs Growing During Economic Slump

This is a follow up to the previous post about the new LED television sets being sold by Samsung Electronics.  As reported in the Chosun Ilbo and other papers today, sales of digital television sets are growing in the world's developed economies, despite the severe economic slump.  This reflects increased consumer spending on in-home activities and also defies the common sense idea that high end appliances do not sell well during an economic recession.  Another factor contributing to the sales is that governments worlwide have adopted policies for switching over to digital broadcasting.   Here in Korea the obvious beneficiaries of this global phenomenon are Samsung and LG Electronics, the world's leading manufacturers of flat screen digital television sets.

The Significance of Korea's New LED Displays

As outlined in a Korea Times story yesterday, Samsung Electronics has launched its new series of LED displays in the Korean market.  They are now available in all major world markets.  Coincidentally, my wife and I purchased a 52 inch Samsung LCD television about a month ago, and have been enjoying it immensely.  We have no buyer's remorse since we purchased the HD TV-ready, top-of-the-line set at a competitive price and will be able to enjoy it for years.  A new LED model would have cost about $1,000 more (we paid about $2,200 for ours).  However, the new LED models are thinner....much thinner, lighter and are also 40 percent more energy efficient, while rendering colors slightly better than our new television set.  This morning, just before coming in to work, I watched live coverage of the Arnold Palmer Invitational from Florida as Tiger Woods sunk a long putt on the final hole to win.  Watching it on the 52" LCD television was so much more fun than on our old, smaller CRT television.

As readers of this blog will know, I'm currently doing my own research on the information and communication revolution in Korea.  In the broad context of this nation's efforts to build an information society, what is the significance of LED televisions and the display industry more generally?   I suggest the following for starters.

• The display industry is a core or "anchor" technology of the information age.  This will continue into the future as sight and visual images are such a major component of human communication.  The closer the actual image on a display is to real human vision, the more realistic the viewing experience will be.


• Korea's growing strength in the semiconductor industry complements its work with displays.  In fact, the manufacturing process for displays is very similar to that for semiconductors.


• By introducing the LED line of televisions now, Korea's companies will have a big edge over their competitors when the global market for these devices reaches economies of scale.  There are as yet no major Japanese, North American or European competitors in the display market.


• From the standpoint of ordinary consumers around the globe, there is no doubt that once the price reaches an acceptably low level, many will trade in their "old" LCD television sets for a newer, lighter, greener and more "fun to view" set.

In short, South Korea's leadership in the display industry is integral to its overall development as a global ICT leader.

"Job Creation 7 Times Slower Than Economic Growth"

An article in today's Korea Times quickly caught my eye with the headline "Job Creation 7 Times Slower than Economic Growth." Fundamentally, this is all due to the advances in communication technology that started in the 1980s and are now bearing fruit. The newspaper article quotes an official from the Ministry of Strategy and Finance as saying ``Korea's industrial structure has transformed into a technology-and capital-dependent one from a labor-intensive one. Manual jobs have largely been moved to China and other Asian economies in which labor costs are much cheaper than here. The economy is expanding without creating as many jobs as it used to." This Ministry official's reference to technology really refers to information and communication technologies (ICT), more than any others. Even more specifically, I would note that there are four key anchor technologies in the fields of industrial and consumer electronics that underpin South Korea's economy today. They are:

• Semiconductors


• Flat screen displays including color television displays.


• Mobile handsets and other devices.


• Electronic switching systems which are key components of digital networks.

As shown in the accompanying graphic, employment elasticity ― the job growth rate divided by output growth rate ― fell to an all-time low of 0.15 in the second quarter of the year, down from 0.25 in the same period last year.