Apple's iPhone 3GS is close to hitting Korean shores, clearly being the most anticipated smart phone release in the local market to date. / Korea Times |
By Kim Tong-hyung
Staff Reporter
South Korean tech geeks' agonizing wait for the iPhone, Apple's do-it-all smart phone that is the world's most sought after gadget at the moment, is about to be over.
The question is whether the phones will deliver on their massive pre-launch hype and truly become game-changing products, or fizzle after blazing onto the scene and become niche items for fans and fashionistas.
Just weeks after permitting Apple to sell the older iPhone 3G model here, the Korea Communications Commission (KCC) gave its blessing again, this time for the new iPhone 3GS, last week after its radio research laboratory completed testing of the devices.
The radio laboratory's approval is mandatory for all telecom equipment to be used locally and is considered loosely as an indicator for market release.
KT, the country's biggest telephone company and No. 2 wireless provider, has been the most aggressive pursuer of iPhone here, beating out industry rival SK Telecom to be the first carrier to release the handsets in the country.
Although company officials declined to comment on the iPhone release, citing confidentiality issues, industry watchers expect KT to put the iPhone on shelves sometime in August.
SK Telecom, which controls more than 50 percent of the country's mobile-phone users, can certainly afford to be a little more patient than KT. However, there is no doubt that the iPhone is being seriously considered by the company.
On the Web site for its T-World mobile Internet service (www.tworld.co.kr) last Wednesday, SK Telecom held a members-only survey to measure interest in the iPhone among its consumers. The respondents were asked whether they would pick the iPhone over other ballyhooed phones like Samsung's Omina 2 or LG's Arena, and also the preferred range of handsets prices and data rates should the carrier release the product.
Showing no hint of subtlety, SK Telecom even asked users whether they will considering switching to another carrier, in this case KT, should the company decide against including iPhone in its handset lineup.
``There is a lot of speculation around the iPhone release, and SK Telecom is expected to make its final decision in the next few days,'' said a telecommunications industry official.
``There are talks that KT will first release the older iPhone models and then release the iPhone 3GS around September or October.''
The iPhone 3GS, revealed in Apple's annual developer conference in June, boasts a number of upgrades from its predecessor, including faster data transfer, a doubled capacity of 32-gigabytes, improved GPS navigation, and a 3-megapixel camera that supports video recording.
The products' approval by the KCC quells any worries that Korean consumers will have to settle for older iPhone models. The devices tested were fully equipped with Wi-Fi functions, government officials said. This comes as a relief to Korean consumers, as there had been concerns that local carriers would pressure Apple into releasing a stripped down version of the iPhone with lesser Internet capabilities and force users to rely more on their expensive data services based on a per packet charge.
Data Rates Are Key
Most industry watchers believe that the iPhone will be a success, at least out of the gate. Park Jong-soo, an analyst from Hanwha Securities, expect KT and SK Telecom to combine for 500,000 to 1 million iPhone customers in the short term, considering the pre-launch buzz and the handset's superiority in software, user interface and data content.
There is also speculation that the iPhone could emerge as the center of the marketing wars between KT and SK Telecom, with both companies spending lavishly on handset subsidies and other consumer benefits to sell more iPhones.
But the iPhone's lack of mobile television functions, comparatively low battery power, and Apple's less-than-stellar reputation as a provider consumer services here, aggravated by its recent handling of malfunctioning iPod media players, are considered weaknesses.
The ``pent-up'' demand for the iPhone is unprecedented for any smart phone model released in South Korea. Apple's iPod Touch, a mobile Internet device that is basically an iPhone without the phone capabilities, is current the country's most popular portable multimedia player with more than 500,000 units sold.
``The level of success will be determined by price. A two-year contract with a flat-rate data plan of about 50,000 won per month would be enough to make a splash here,'' Park said.
It remains to be seen whether Korean mobile users are willing to pay 30,000 won to 50,000 won per month for data usage, in a country where the mobile Internet explosion has yet to occur.
Also questionable is how far KT and SK Telecom will go in promoting the iPhone, as the handset could pose a challenge to their existing business models. Additionally, the Korean companies aren't too happy about sharing their data revenue with Apple, as the U.S. company does with other operators around the world.
And the thought of users downloading cheap or free software from Apple's AppStore and browsing the Web using Wi-Fi networks is a disturbing thought for the Korean carriers, which would hurt existing mobile Internet services like Magic-N and Nate. It's not like they will get anything from the AppStore transactions, where the revenue is shared between Apple and the software developers.
Although KT has been expressing full-commitment toward the iPhone, SK Telecom seems to be hedging its bets, planning to generate just as significant a buzz by releasing a handset based on the Google-backed operating system, Android, down the road.
Android-based phones could certainly provide a friendlier model for mobile carriers, as the revenue from the online market is expected to be shared between the carriers and the software developers.
thkim@koreatimes.co.kr
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