The iPhone Juggernaut Swallowing Everything in its Path

by WangKon936 on January 9, 2010

in Korean Economy

No, this is not a post by the Metropolitician and the title is not reflective of reality.  At least not yet.

Since the last couple of postings about the iPhone in Korea, there has been a number of articles highlighting its popularity and its significant advantages over other touchscreen and “smart” phones from Korean manufacturers.

However, there were two articles that have gotten my attention.  The first is from The Chosun Ilbo that says the iPhone captured 10% of the Korean cell phone market in December.  Yes, I know that it is just one month and there was a lot of penned up demand, but 10% of total cell phone sales in just one month of release?  And that’s total cell phone sales not merely smartphone sales.  Then there is newly released information that a “Korean company” tried last minute to keep the iPhone out of Korea.  According to Telcoms Korea, there is strong evidence that the “Korean company” was Samsung and, get this, the person at Samsung making the request personally was none other then Lee Jae-yong, the 40 year old, pretty boy, recently divorced and recently promoted son of former Samsung Group chairman Lee Kun-hee.  Interesting development as the elder Lee hands over the keys to the family Porsche to the younger Lee.

But let’s not cry for Samsung and Lee Jae-yong just yet.  They are killing it everywhere else, so much so that the old Sony rivalry can barely be considered a rivalry any more.

{ 27 comments… read them below or add one }

1 KrZ January 9, 2010 at 5:46 am
2 jefferyhodges January 9, 2010 at 6:31 am

That’s one hungry juggernaut! Usually, they’re content just to smash things.

Jeffery Hodges

* * *

3 thekorean January 9, 2010 at 7:44 am

…or call everyone a bitch.

I’m the Juggernaut, bitch!!”

4 DLBarch January 9, 2010 at 7:51 am

The fact that Samsung is able to compete so effectively everywhere else is Exhibit A for why Korea’s telecom market should have been opened up eons ago, and why the U.S. should have slapped tariffs on Samsung phones back when it would have made a difference.

But that would have been protectionist, and everyone knows that protectionism doesn’t work. Except in Korea, where the “laws” of Econ 101 don’t apply.

Why is it that those championing the success of Korean companies inevitably never acknowledge the protectionist foundation upon which that success is based?

Over to you, WK.
DLB

5 thekorean January 9, 2010 at 7:58 am

Why is it that those championing the success of Korean companies inevitably never acknowledge the protectionist foundation upon which that success is based?

I do fully acknowledge that protectionist foundation, Mr. Barch.

6 WangKon936 January 9, 2010 at 7:59 am

As well as I… however, DLB and I may disagree with the necessity and utility of it.

Apologies, but sometimes my sock (thekorean) gets carried away and answers my questions for me!.. ;)

7 DLBarch January 9, 2010 at 8:02 am

Oh, crap. Has MH changed that much in the two weeks I was on hiatus? You two are being much to civil!

Cheers,
DLB

8 Angusmack January 9, 2010 at 9:07 am

Not that I’m defending Samsung or the prince who has succeeded to the throne, but it must be a real bitch slap to steamrolled in your own backyard. Especially for a company that has so long and successfully suckled at the mercantilist teat like Samsung, and the rest of Korea Inc. for that matter. Not to mention that the design of this barbarian phone essentially spikes a key plank of Samsung’s business model. I mean really, what the hell is Samsung gonna do if they can’t convince people of the need to replace their phones every year? Start developing softwear?!?!?!?

9 WangKon936 January 9, 2010 at 9:44 am

I think DLB is looking for one of those adrenaline pushing TMH comment shout feasts that get people’s blood pumping… hahaha…

Uh, I already shot my load for the week. Blame Sperwer… ;)

Besides… the Korean hand phone and car market (as well as cheese, beef, wine, you name it) can use some good ole fashion laissez faire opening up… it is about time.

10 Brendon Carr January 9, 2010 at 10:10 am

Does anyone doubt that iPhone will hit 1,000,000 units sold this year? Kind of funny when you consider how all local press worked hard to convince the Korean public iPhone would flop and they didn’t want to back a loser.

We had 60,000 pre-sales at the end of November, and nearly 200,000 units put into the hands of customers in December. iPhone’s sales will very soon surpass the total number of smartphones (about 450,000) in the entire Korean market prior to the launch of iPhone. Maybe it’s happened already — they’re selling very briskly and I’d bet the reporting can’t keep up. When I visit local KT Show phone shops the staff reports that nearly all their customer interest is focused on the amazing iPhone.

One important knock-on effect of the iPhone igniting the Korean smartphone market will be that Korean web designers now must adopt Web Standards-based practices to make sites accessible to users of platforms other than Internet Explorer 6, ActiveX controls, and Flash. None of that works on iPhone’s WebKit-based Safari browser, it doesn’t work on the Mac, and it doesn’t work on Firefox, Opera, or other browsers on the PC. Forty percent of web users worldwide are excluded by Korean coding practices.

What about financial transactions? All the payment systems are built around ActiveX on desktop Windows. Not so easy to ignore 1,000,000+ mobile users, though.

Android, too, uses WebKit, so in order that web pages work on the forthcoming Korean “iPhone killers” these skills must be adopted quite quickly. We’re at least five years behind the rest of the world.

A happy effect of this will be that Korean designers will in the near future be able to deliver product that’s in demand around the world, not just here in Korea. More opportunities for everyone!

11 WangKon936 January 9, 2010 at 10:24 am

The sooner Korean tech companies decouple from Microsoft the better… but what’s this?

Microcrap is working its way into Korean cars???

http://online.wsj.com/article/SB10001424052748704350304574638971027854960.html?mod=googlenews_wsj

12 cm January 9, 2010 at 12:53 pm

Better sell those iPhones as much as they can, because that’s about all that America produces and sells well at this moment. As we know, the US prints money out of thin air, backed by nothing and practically producing nothing. Look at the nation of America. It’s now a nation of overweight slobs, eaters of junk food, and producers of junk mind. It’s hard to believe that these people are the descendants of hard workers who built a great superpower nation unrivaled by anyone by using their hands and through can-do spirit based on American value.

It’s hard to believe how Americans stand by with hardly a peep, and let their elites rob this nation blind. Entire corporate America is corrupt to the bone, drunk with free money provided to them by another corrupt but incompetent manipulative government which is bankrupting the nation.

So let’s examine this statement:

“But that would have been protectionist, and everyone knows that protectionism doesn’t work. Except in Korea, where the “laws” of Econ 101 don’t apply.”

Really? Korea has over $40 billion trade surplus last time I looked. Korea isn’t the country with $1.5 trillion trade deficit and $1 trillion budget deficit with $13 trillion in debt and exponentially growing by $15million per second. Call me crazy, but the way I see it, it’s America where Econ 101 don’t apply with all those socialistic assistance to corporate America at the expense of tax payers, and it’s America where nothing is working. America’s elites have sold their people down the river.
Americans should worry about their own country and their problems before they start worrying about others.

My point is this. Where do Americans get off telling other nations what is and what isn’t? I find it humorous and incredulous. (I’m presuming you are American?)

Sorry for my rant, but I had to get that off my chest.

13 The Metropolitician January 9, 2010 at 4:02 pm

Don’t know why my name came up from out-of-the-blue, but the proper spelling of my beloved moniker is “Metropolitician.”

And while my predictions have been called too optimistic (I estimated that an iPhone would take half the smartphone market in a single year were it released, based on the killer combination of a) being a great product, and b) the “sexy” factor that even Apple-deprived Koreans feel even MORE, precisely because Apple products have always been overpriced and doubly earned the “unattainable luxury” reputation in Korea), now I’d say they were too conservative.

Almost every Korean person I know who owns a smart phone is in a contract and laments not being able to buy an iPhone RIGHT AWAY. Also, there is a common misconception still that the iPhone is expensive. When I tell them the actual payment plans — which can be cheaper than their existing phones — they all wince and look at their device differently.

Apple’s going to nuke the cellphone market here.

And yeah, drive the popularity of Twitter (in a Korean version of the program that uses the network) as well as Facebook by the end of summer, for a variety of reasons I’ve already laid out elsewhere.

14 Pohang January 9, 2010 at 5:22 pm

You know what motherf**ker? You gonna get hurt by my pimp cane one way or another.

15 Brendon Carr January 9, 2010 at 5:27 pm

Lee Jae-yong has been, until recently, Samsung Electronics’ “Chief Customer Officer”. Apple Inc. has been, until recently (and probably still is) Samsung Electronics’ biggest customer. Damn fine customer relations, this — if the reports of Lee personally lobbying the Korean government to continue screwing over his biggest customer (and, let’s not forget, all the captive little people: the citizens and residents of Korea) are true.

Such would require a level of rapacious amorality one could hardly imagine from a leading Korean company, to say nothing of Samsung, plus incredible mendacity on the part of the Korean government, so I choose to believe the stories are not true.

16 SeoulFinn January 9, 2010 at 6:47 pm

May I state my humble opinion? I don’t see iPhone as a smartphone. To me and many others, iPhone is a music player, a really good one at that, with phoning capabilities.

When I think of a “real” smartphone, Nokia’s e71, e72, n97 and n900 come to my mind. Well, n900 is more likely a computer with phoning capabilities. (I know that there are zounds of other brands that have very capable smartphones, but I’m not that familiar with them. Sorry!)

I might return to Korea soon – yay for me! – and I’d really like to use n900. Has anyone registered a foreign phone in Korea? I ask this because there is one thread at Dave’s (“using an unlocked iphone brought over from the states…”). Someone mentioned how he had his unlocked U.S. iPhone certified and can now use it in Korea. The fee involved was 300 000 won and took 4 to 5 weeks.

17 Sperwer January 9, 2010 at 8:39 pm

Such would require a level of rapacious amorality one could hardly imagine from a leading Korean company, to say nothing of Samsung, plus incredible mendacity on the part of the Korean government, so I choose to believe the stories are not true.

I’ll assume that the irony meter was on full throttle for that one. :)

18 JW January 10, 2010 at 12:53 am

Hummm…I thought business amorality is only “incredible” when people fuck with entire economies or people’s health, like Wall Street and America’s pharmaceutical and health insurance industry. You know, cuz “business ethics” being what it is — in addition to being the most shameless oxymoron ever invented — I thought the bar was set really high for qualifying as “incredible” fuckedupness. But that’s just me I guess.

19 iheartblueballs January 10, 2010 at 4:26 am

Sorry for my rant, but I had to get that off my chest.

You’d have been far better off — at least in terms of your reputation — if you’d kept that on your chest.

And yeah, drive the popularity of Twitter as well as Facebook by the end of summer,

Two trends that need to die quick and painful deaths.

20 WangKon936 January 10, 2010 at 5:03 am

Sorry Metropolitician, fixed.

21 foobat January 10, 2010 at 1:20 pm

i agree with Metropolitician. once people start finishing up their current contracts, the exodus will be even greater—especially without a decent competitor. those getting an Andriod phone will do so because it will be what SK is shoving into their faces as being faithful to Korea, or the Apple haters. i have two other predictions to add:

1) Korean phone companies will give up on their phone OSes and load Android with their software (which is still seen as superior although loading up an mp3 from a computer is near impossible without a Melon player if at all) as applications. these efforts will give them some footing, but not a lot since all of the Korean phone software is inherently clumsy. there will be better apps, but they are at least a year and a half away.

2) Apple will have to get its chips from Japan (or China a little later on)

and the bonus*:

3) Samsung will continue to provide Apple with chips and treat them like the best customer when SK picks up iPhones. in doing so, we will see many reports on how the iPhone is a 60% Korean product and how Apple might be a good company, but they arent as smart as Samsung for making the iPhone. expect Koreans to start telling you that the iPhone is really Korean and has been all along.

* although #3 is unlikely, it is the best and most immediate way for Samsung to stop taking it when it comes to smartphones and (eventually cellphones).

22 chrisinsouthkorea January 11, 2010 at 12:46 am

Hmmm… other than Samsung, who else would want to keep the iphone out? Certainly not the public, who’ve bought this thing left and right (probably won’t go much higher than 15% or so now that the early adopters and tech geeks have all gotten theirs).

As for how much Apple has to be concerned with the Korean press. None. Nadda. Exactly. Apple is worldwide, and has cred and street cred almost everywhere you go. If I’m Apple, I don’t care whether the Korea Times says the iPhone was really Korean all along – I’m laughing the whole way to the bank. So what if it uses Samsung parts? The software is still intuitive, many apps still free, and what people want.

Does Android really have the name recognition amongst the cellphoneistas here? I know it because I’m a geek, but guessing I’d be hard pressed to find Koreans who could tell me what it did without a leading question.

23 chiamattt January 11, 2010 at 7:41 am

The revolution has already started. Hana Bank now offeres web banking for iphone users.

A few weeks before the iphone came out, some friends of mine got the Blackberry, and it cost 800,000. A few days after the iphone was released, another friend of mine got the Blackberry for 250,000. It’s quite shocking how quickly and how violently SKT shit in their pants.

I feel sorry for people I see using the Omnia2, and envy those I see with Blackberries and iphones.

24 WangKon936 January 12, 2010 at 3:55 am

@ # 21,

Well, if this chip is as good as they say it is, Apple may still need to buy chips from Samsung:

http://news.cnet.com/8301-13924_3-10296754-64.html

It had to partner w/a U.S. firm to develop it, but there’s some interesting “buzz” on Hummingbird.

25 cmm January 13, 2010 at 10:26 am

What’s this?

http://joongangdaily.joins.com/article/view.asp?aid=2915231

I like replaceable batteries too, but what exactly is the source of the data?

26 judge judy January 13, 2010 at 11:47 am

now that’s pretty transparent.

27 Brendon Carr January 15, 2010 at 8:33 pm

Uh oh: It doesn’t appear that the Google phone has set the world on fire after its launch.

A report on The Unofficial Apple Weblog (TUAW) puts the first-week Nexus One sales in the United States at a paltry 20,000 units against a backdrop of supposedly horrible customer support and the phone not being quite a match for the iPhone experience.

But I’m sure Samsung’s forthcoming Android phones will be the true iPhone killers. What? We should all develop for Samsung’s vaporware bada platform and imaginary Samsung App Store instead?

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