Local gadget lovers may finally end their long wait, as industry sources expect Apple’s iconic smart phone, the iPhone, to reach Korean shores later in the year. / Korea Times |
By Kim Tong-hyung
Staff Reporter
For South Korean tech geeks, the statute of limitations has clearly passed on being outraged over the iPhone's delayed debut in a country that claims to be the wireless capital of the world.
But it remains to be seen whether they are finally about to be rewarded for their patience, as industry sources believe Apple's do-it-all smart phone is nearing Korean shores.
There have been constant rumors about the iPhone's domestic release since last year, with KT, the country's No. 2 wireless carrier, engaging in talks with Apple to challenge the superior handset lineup of first-placed SK Telecom.
Hopes were raised when Korea retired its homemade standard specifications for data-enabled mobile phones, dubbed WIPI (wireless Internet platform for interoperability), in April, eliminating what has been an effective trade barrier for foreign phone makers.
The buzz was killed momentarily earlier this month after Apple's annual developer conference revealed that Korea wasn't included in the 80 countries where the company plans to roll out its new iPhone 3GS.
But with Apple recently gaining regulatory approval from the Korea Communications Commission (KCC) radio research laboratory to sell its older iPhone 3G here, the geek community is rocking with excitement yet again. KCC officials confirmed that it was Apple, not KT or SK Telecom, which applied for the tests.
Although receiving the radio laboratory's approval is mandatory for any telecom equipment to be used locally, the certificate is by no means a surefire indicator for market release.
Local handset makers apply for approval on dozens of models every year, but not all of them get the final clearance to be placed on the shelves. Still, the iPhone gaining KCC approval makes it evident that Apple has no intentions of missing out on the Korean market.
There are a lot of arguments over whether the iPhone's older, 16-gigabyte model would be enough to generate noise in the Korean market, where wireless users have grown accustomed to new handsets seemingly released every other month.
But considering that the tests for radio approval takes just over a month, who knows whether the iPhone 3GS is being tossed around in the KCC lab right now.
``The radio approval could mean that the more difficult process of network interoperability tests, examining whether a handset functions normally under the network of a carrier that is about to release it, which could take three to four months, may be already over,'' said an industry official.
``If this is true, the next step is assigning international mobile equipment identity (IMEI) codes to each handset and provide them to the operator, which in this case, would be KT. I think it's safe to assume that KT and Apple are in the final phase of their talks.''
Officials from neither KT nor Apple were willing to confirm whether an iPhone release is immediate. But some industry sources believe that the phones will be on the shelves by the end of the year, with an August release being a remote possibility.
``The debut of iPhone is a major issue for us, as we develop mobile Internet applications for wireless users, and we had prepared for several release dates, including July and December last year,'' said an official from a top-three Internet company, who didn't want to be named.
``The government dragged on its WIPI decision longer than expected, and things got complicated when KT got messed up in a corruption scandal late last year, but KT always remained in the game.''
Mixed Predictions
Although SK Telecom is also in talks with Apple, it is expected that KT, the more desperate of the two, will be the first Korean carrier to release the iPhone.
Still, industry officials believe that SK Telecom will likely release the iPhone should KT get off to a bright start with the iconic phone. Controlling more than 50 percent of the country's mobile users, SK Telecom can afford to be patient, boasting a degree of leverage in its talks with Apple that KT can only dream of.
Although the iPhone is clearly the most anticipated electronics gadget in years, there are mixed predictions about its level of success here.
Optimists focus on the immense popularity of Apple's iPod Touch, which is the top-selling portable multimedia device at the moment and has users feverishly downloading programs from the company's App Store online content market.
Skeptics point to the iPhone's under-whelming performance in Japan, where desperate operator Soft Bank is providing the handsets for free to subscribers signing up to two-year contracts under its ``iPhone for everybody'' campaign.
There are a lot of explanations for the iPhone's struggles in Japan, including the lack of video capability, mobile television reception and infrared rays communication functions, which are conventionally used by the Japanese for swapping phone numbers, in the older iPhone models.
However, the biggest reason could be that Japan's competitive wireless market is allowing consumers to choose from a wide range of affordable monthly data plans with which the iPhone is failing to compete.
This is perhaps the most distinctive difference between the mobile markets of Japan and Korea, where users are stuck to the expensive, ``walled garden'' of mobile Internet services dictated by local carriers, which is the very reason they wanted the iPhone to come and shakeup the game in the first place.
The monthly fee of about $60 for the iPhone's maximum rate data plan in Japan was considered too expensive, although Soft Bank recently lowered the price to around $45.
However, this is arguably still a better deal than what mobile users get in Korea, where carriers tend to use the word ``unlimited'' liberally in their flat rate plans when they are actually providing a limited package of content with a ceiling in data usage.
Of course, aborting the flat-rate plans and being exposed to the per packet charge structure of local mobile carriers is a dangerous move for Korean users.
Operators here charge about 2 to 3.5 won per kilobyte in data transmission, while also charging separately for content fees. So it takes about 5,000 won (about $4) to download a 3-megabyte pop song, 20,000 won for downloading three ring tones and about 40,000 won for an hour of news searching.
``The reason I want an iPhone is simple ― I am tired of paying the premium for the same old stuff again and again on my handset that only accesses the mobile Internet through Nate,'' said Park Sung-ha, a 32-year-old Seoul office worker who carries an iPod Touch along with a Samsung mobile phone.
``These telecommunications companies always talk about globalization and marketing their products and services elsewhere, but when the discussion becomes about providing global-standard services to local customers, they play dumb.''
How Open Are Carriers Willing to Be?
Consumers have long been calling for Korean wireless carriers to open their mobile Internet networks to allow users to access any service they want, while also lowering their data rates.
However, KT and SK Telecom had been reluctant to compromise their tight control of the content revenue chain.
The carriers have so far dictated how their subscribers connect to the network, what they use, and how much they pay for it. They have also been forcing electronics makers like Samsung and LG to strap the Wi-Fi functions of their phones sold in the domestic market to prevent users from accessing free Internet.
Of course, a release of the iPhone would force all of this to change. The idea of iPhone users downloading cheap or free games and software from computers and browsing the Web using Wi Fi networks, which would also enable voice over Internet telephony (VoIP) calls, is a scary thought for wireless carriers.
The Koreans also aren't too happy about sharing their data revenue with Apple, as the U.S. company does with other operators around the world.
However, it could also be argued that the Korean carriers need the iPhone more than their subscribers do. Although the country's wireless users with data-enabled third-generation (3G) handsets now stand at around 20 million, the data revenue of carriers shows that people aren't using their fancy phones for much other than voice.
This has the companies desperate to get more return on their massive investment in 3G networks, and the iPhone could just be what the doctor prescribed.
``If the iPhone forces the carriers to be more open, we could be talking about a mobile Internet explosion that was supposed to happen here years ago,'' said the Internet company official.
``KT and SK Telecom are pushing their own versions of App Stores, but they will have to eventually find a way to enrich content for iPhone users, as well as the users of other smart phones.Of course, the carriers will have to give some of the earnings to Apple, but the market could become that much bigger.''
thkim@koreatimes.co.kr
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