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Korean IT Industry for Next Decade New Opportunities for Global Partners. April 7, 2005 Myung Sun, Choi President of Korea Association of Information & Telecommunication (KAIT). Table of Contents. ICT Status of Korea. ICT Status of Korea. IT 839 Strategy. - PowerPoint PPT Presentation
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Ubiquitous IT Korea1
Korean IT Industry Korean IT Industry for Next Decadefor Next Decade
New Opportunities for Global PartnersNew Opportunities for Global Partners
April 7, 2005April 7, 2005
Myung Sun, ChoiMyung Sun, Choi
President of Korea Association of President of Korea Association of Information & Telecommunication (KAIT)Information & Telecommunication (KAIT)
Ubiquitous IT Korea2
ICT Status of Korea ICT Status of Korea
Business Opportunities in Korea Business Opportunities in Korea
Table of Contents Table of Contents
ICT Status of Korea ICT Status of Korea
IT 839 Strategy IT 839 Strategy
Ubiquitous IT Korea3
US$ 605B(11th)
GDP
US$ 194BGlobal M/S 2.6%(12th)
ExportImport
US$ 178BGlobal M/S 2.3%(14th)
US$ 373B Global M/S 2.4%(12th)
Trade Volume
Source: Bank of Korea
[2004]
[2003]
US$ 224B US$ 254B US$ 478BUS$ 634B
800
600
400
200
1970 1980 1990 2000 2001 2002 2003
(Unit: KRWT )
*
* : GDP US$ 605B
Real GDP Growth (1970-2003)Real GDP Growth (1970-2003)
Overview of Korean EconomyOverview of Korean Economy
Import Export(Unit: US$B)
Export/Import Trend (2000-2004 )
0
50
100
150
200
250
300
2000 2001 2002 2003 2004
Ubiquitous IT Korea4
Korean ICT Leading the World MarketKorean ICT Leading the World MarketKorean ICT Leading the World MarketKorean ICT Leading the World Market
Contribution to Korean Contribution to Korean
Economy :Economy : GDP (14%) & GDP (14%) &
Export(30%) Export(30%)
HHP(28.8%) TFTLCD
(41.3%) DTV(13%)
MP3(20%)
Memory(45.0%)
Ubiquitous IT Korea5
Mob
ile
Phon
e
Syst
em L
SI
Mem
ory
LCD
D-TV
Broa
dban
d
equi
pmen
t
50
100
150
200
(B$)
250
10%
20%
30%
40%
60%
50%
Compu
ter
3434 3333
109109
196196
1818
107107
MP3
P
2266
SW
’03 Market Share’03 Market Share
’02 Market Share’02 Market Share
Global Market SizeGlobal Market Size
17917928.8%28.8%
13%13%
43.8%43.8%
41.3%41.3%
4.1%4.1%3.4%3.4%2.4%2.4%
20%20%
2.5%2.5%
24.9%24.9%
11.5%11.5%
2.4%2.4% 2.8%2.8% 2.4%2.4%
7.7%7.7%
45%45%
37.7%37.7%
15.0%15.0%
Major Korean ICT Products : M/S Major Korean ICT Products : M/S
Ubiquitous IT Korea6
0
5
10
15
20
25
30
35
System LSI LCD MP3P DTV ComputerSystem LSI LCD MP3P DTV Computer
19.8
(16.9)
21.5
(10.2)
30.4
(20.5) 1.1
(0.2)
3.9
(1.7)
3.7
(0.6)
Total Production
Export
(B$)
Mobile Phone
(15) (44) (10) (152) (10) (12)No. of
Companies
Major Korean ICT Products (Cont’d) Major Korean ICT Products (Cont’d) : Total Production/Export/No. of companies: Total Production/Export/No. of companies
Ubiquitous IT Korea7
8 Services8 Services
WiBro Service
DMB Service
Home N/W Service
Telematics Service
RFID-based Service
W-CDMA Service
Terrestrial DTV
Internet Telephony
Broadband Convergence NetworkBroadband Convergence Network
Ubiquitous Sensor NetworkUbiquitous Sensor Network
Next Generation Internet ProtocolNext Generation Internet Protocol [IPv6][IPv6]
3 Infrastructure3 Infrastructure
Mobile Telecomm Handset & Equipment
Digital TV & peripherals
Home Network HW/SW
System-on Chip
Next Generation PC
Embedded SW
Digital Contents & SW Solutions
Telematics
Intelligent Service Robot
9 Products9 ProductsServiceService
InfrastructurInfrastructuree
ProductProduct
IT839 StrategyIT839 Strategy
Ubiquitous IT Korea8
Role of Gov’t
Role of Business
Value chain of ICT industryValue chain of ICT industry
Ubiquitous IT Korea9
Wireless BroadbandPortable Internet (WiBro) (’06) Start of Commercial Service
Digital MultimediaBroadcasting (’06) Introduction of Bilateral Service
Home Networking (’07) Deployment to 10M Households
Telematics (’07) Serving for 10M subscribers
RFID/Ubiquitous Sensor NW (’07) Nationwide Applications
W-CDMA (’06) Nationwide Broadcasting NW
Terrestrial DTV (’05) Nationwide NW Coverage
Internet Telephony (VolP) (’07) Serving for 4M subscribers
New Services Activities & Plans
Rollout Plans for the 8 Services Rollout Plans for the 8 Services
Ubiquitous IT Korea10
Evolution of Mobile CommunicationsEvolution of Mobile CommunicationsEvolution of Mobile CommunicationsEvolution of Mobile Communications19
91-
1995 2G2G
Mass Market for Cell Phones10 Kbps
GSM / TDMA
CDMA 95A
199
9 2.5G2.5GWireless Net Service
64 – 144 Kbps
GPRSCDMA 95B
CDMA 1XEDGE
Location-Based Services384 – 2000 Kbps
WCDMA CDMA EVDO3G3G
200
1-20
05
OFDMOFDM10 – 100 Mbps
4G4G
201
0
3.5G
1G1GFirst Car Phones
198
1-19
83 * Advanced Mobile Phone SystemAMPS *
Ubiquitous IT Korea11
T - DMB : max. 700kbps @1.5MHz BW based on Eureka 147 World DAB Forum adopted as Standard. Commercial Service (1H 2005) S - DMB : Commercial Service (1H 2005)
T - DMB : max. 700kbps @1.5MHz BW based on Eureka 147 World DAB Forum adopted as Standard. Commercial Service (1H 2005) S - DMB : Commercial Service (1H 2005)
DMB Network
Data Server
AV Server
BroadcastingStation
ReturnChannelServer
MediaAuthoring
Station
InternetMobile Network
(WiBro, CDMA, etc.)
SatelliteDMB
TerrestrialDMB
DMB : ‘Digital TV in Your Hand’DMB : ‘Digital TV in Your Hand’
Ubiquitous IT Korea12
Public Procurement
Ammunition ControlLogistics Management
Imported Beef Tracking Air Luggage Tracking
RFID/USN ServiceRFID/USN ServiceRFID/USN ServiceRFID/USN Service
Pilot Projects were initiated to create market demandand thus to accelerate the technology development.
Ubiquitous IT Korea13
[Bil
lio
n $
]
0
10
20
30
40
50
60
70
80
90
100
2004 2005 2006 2007 2008 2009 2010 2015
ControllableNetworkSensor ActivePassive
0
10
20
30
40
US
N W
orl
d-w
ide
Mar
ket N
um
ber o
f Ch
ips [B
illion
]
RFID/USN Market EstimationRFID/USN Market Estimation
Ubiquitous IT Korea14
9 New Growth Engines9 New Growth Engines9 New Growth Engines9 New Growth Engines
’02’02 ’05’05 ’07’07
116116116116
156156156156
175175175175
1729
36 Evolution toward broadband convergence NW
Key product to lead the global IT Industry
4G mobile comm. prototype by 2007
Low power source
tech/core parts Global standardization
’02’02 ’05’05 ’07’07
21
38
58
9
17
Rapid growth of DTV market
Core device in convergence era
13.5M DTV’s in Korea (’07)
Nationwide digital broadcasting NW (’05)
20hrs/week HDTV broadcasting (‘05 )
Strategic Strategic ImportanceImportance PlanPlan
Mobile HHP& Equipment
Digital TV
3
Market ($B)Market ($B)
(Korea) (Global)
Ubiquitous IT Korea15
9 New Growth Engines (Cont’d)9 New Growth Engines (Cont’d)9 New Growth Engines (Cont’d)9 New Growth Engines (Cont’d)
IT SoC
DC & SW Solutions
Strategic Strategic ImportanceImportance PlanPlan
’’0202’’0202 ’’0505’’0505 ’’0707’’0707
92929292
138138138138
173173173173
8 17
SoC critical for overall competitiveness
Huge demand led by digital convergence
Top 3 IT SoC Country (’07)
Strategic Alliance in SoC & Systems
Industrial infra. for low cost SoC development
’’0202’’0202 ’’0505’’0505 ’’0707’’0707
53535353
90909090
127127127127
712
2
Value-added industry
Large SW Engineer Pool
Top 5 DC Country(’07)
Core tech. (DC developing tech.)
Building an IT Complex (’07)
2
Market ($B)Market ($B)
(Korea)
(Global)
Ubiquitous IT Korea16
S/W & Digital ContentsS/W & Digital Contents
ComponentsComponents
Equipment & Devices Equipment & Devices
ServicesServicesB$
2003 2004
176176203203
2007(e)
16162121
25253030
3838
67677575
8787103103
128128
6868 8282100100 130130
5757
3939 4242 4343 51513636
347347
236236276276
2005(e) 2006(e)
Start of Trial Service
Start of Trial Service
DTVVoIP
W-CDMA
Home Network
DMBTelematics
RFIDWiBro Domestic ProductionDomestic Production
Expected Outcome of IT839 StrategyExpected Outcome of IT839 Strategy
Ubiquitous IT Korea17
ICT Enterprises in KoreaICT Enterprises in Korea
SMEsLarge enterprises
74%
26%
15%
85%
350
22,900
318,000
250,000
(2004)
Exports Total 74.7 Billion $
Production Total 226 Billion $ No. of Companies
No. of Employees
Ubiquitous IT Korea18
Create Leading SME Group
Strengthen Global Competitiveness
Develop Strategic Industries (Components, SW)
Supporting Policies for SMEsSupporting Policies for SMEs
IT Small & Medium-sized Enterprises Revitalization Program
OverseasMarketing
Education & Training
ASP RentalFor 1Million SMEs
Consulting Advice
CommunityFormation
ProvidingShared Services
Stable Financial Support System
Company ProfileDB Construction
Partnership withLarge Companies
Technology Transfer
11
22
33
44
55
66
77
88
99
1010
Ubiquitous IT Korea19
Internet Use
Country
Iceland
Sweden
US
New Zealand
%
67%
57%
55%
53%
Rank
1
3
4
5
Broadband Subscribers
Country
HK
Canada
Taiwan
Belgium
#
153
112
93
84
Rank
2
3
4
5
Mobile Phone Subscriber Ratio
Korea Japan CanadaU.S.AAustralia
0
20
40
60
8064
69
3850
64
(# of subscribers per 1,000 inhabitants)(ITU, IMD World Competitiveness Yearbook 2004 , World
Telecommunication Indicator)
““Most competitive in ICT industry among OECD countries”Most competitive in ICT industry among OECD countries”- 2004 (Source: OECD)- 2004 (Source: OECD)
World Best ICT InfrastructuresWorld Best ICT Infrastructures
Korea 218 1
Korea 60% 2
%
Ubiquitous IT Korea20
Research area Key Decision Factors
Foreign R&D Centers in KOREAForeign R&D Centers in KOREA
• World leading ICT infrastructure• Gov’t strategy focusing the national
growth engines
Telematics, Embeded SW(6/’04)
• World leading BB & mobile penetration• Strong Gov’t commitment to introduce
new services & tech• A large pool of experienced researchers
Digital Home, Wireless communication(3/’04)
• World leading ICT technology • Tech-savvy Consumers
RFID/USN
(10/’04)
Ubiquitous IT Korea21
Research area Key Decision Factors
Foreign R&D Centers in KOREAForeign R&D Centers in KOREA
• Excellent workforce, motivation, know-how • Good product base • Direct access to key customers • Innovative market
N/W Equipment
SIEMENS(6/’04)
• Strong manufacturing base• HR of high quality• Know-how in ICT application techs
Virtual Simulation
FranunhoferIGD
(5/’04)
• Leading mobile technologies• A large pool of quality engineers in RF area
RF ModuleAgilent(2/’05)
Ubiquitous IT Korea22
Ideal Test-bed Ideal Test-bed MarketMarket
Large Domestic Market
World Class ICT Industry & Infrastructures
Consumers in favor of innovative technology and products Aggressive Rollout Plans of New Telecom and Broadcasting Services
Shared Services Available (Testing, Wafer Fab., EMS, IDC, Legal, IP and SW) Over 20,000 companies in IT- related business.
Large Pool of Human Resources Over 240,000 college graduates (~60,000 for IT) annually 1.2M IT- related employees (Mostly Engineers)
Strength of Korean ICTStrength of Korean ICT
Collaboration among Industries, Universities & Government Sharing the Vision for Globalization and Economic Growth Over 5% of GDP for National R&D Spending
Ubiquitous IT Korea23
Geographic Attractiveness of KoreaGeographic Attractiveness of Korea
Courtesy : Pietro A. Doran, Gale International Korea
Logistics Base of Northeast Asia
Regional Financial Center
Northeast Asian R & D Base
Free Economic Zones
Hub of Northeast Asia
ICT & Electronics
Automobiles
Financial Services
Investment Opportunities
North Korea
South Korea
Ubiquitous IT Korea24
ICT Industrial ClustersICT Industrial Clusters
Digital contents, Media & Entertainment
Digital Media City Digital Media City
New material, Sophisticated
Electronics
Daedeok Special Daedeok Special Development ZoneDevelopment Zone
SW, Service, Mechatronics
Songdo Songdo Free Economic ZoneFree Economic Zone
Ubiquitous IT Korea25