Smart Phones Advanced but Expensive
By Kim Tong-hyung
Staff Reporter
More and more wireless users are splurging on expensive mobile phones that double as handheld computers ― but it's hard to tell whether they are paying for toys or tools.
After showing indifference for years, it looks like Korean gadget lovers are finally acquiring a taste for smart phones, or data-enabled handsets that merge voice, video, e-mail and organizer features in a single device.
Samsung Electronics, the country's biggest electronics maker, has sold more than 25,000 of its latest mobile phone, ``T-Omnia'' (SCH-M490), just a month after its late November release.
A bright start to T-Omnia, now selling around 1,000 per day, is considered crucial for Samsung as it sees the model as its biggest weapon against Apple's iPhone and other internationally popular handsets that are about to hit Korean shores.
Samsung is also reporting increased sales for its other smart-phone models, such as ``Ultra Messaging'' (SPH-M4800) and ``Multi Touch'' (SPH-M4655), while industry rival LG Electronics has high hopes for its touch-screen phone, LG-SU100, which supports the mobile version of the ``Franklin Planner'' organizer system.
The handset markers are convinced that smart phones could make a difference in sustaining growth in a country with a mobile phone fixation.
According to industry figures, about 23 million new handsets were sold here last year, a 10 percent growth from 2007.
And topping the popularity contest were ultra-modern, touch-screen phones such as Samsung's ``Haptic'' and LG's ``Wine Phone,'' showing that, despite the economic downturn, Korean consumers are still responding to innovative products.
But whether the sales of the advanced mobile phones, which often cost more than slightly outdated television sets, will maintain the current growth trajectory when it seems that only a few people are using the devices for anything other than phone calls is a question yet to be answered.
Industry watchers point out that demand for expensive cellular phones could be limited by the cost and complexity of monthly plans, which perhaps reflect the uneasiness of wireless carriers who would rather keep subscribers locked into their walled gardens of data services than venturing out.
Foreign Invasion
The competition for smart phones is expected to accelerate in the New Year, with foreign electronics makers finally allowed a fair shot at Korea, the self-proclaimed world mobile-phone capital.
After dragging its heels for months, the Korea Communications Commission (KCC), the country's broadcasting and telecommunications regulator, finally decided to scrap WIPI, a local software standard mandated for data-enabled handsets.
The homemade standard specifications, which had effectively been a trade barrier for foreign electronics makers like Apple and Nokia, will be ended in April, ending the wait by local consumers for iPhone and other globally popular products.
And some of the bigger players are already here. SK Telecom, which owns more than 50 percent of the country's wireless market, is already providing products from Taiwan's HTC and Canada's RIM, known for its iconic Blackberry handsets.
SK Telecom is expected to release its first handsets from Nokia by the end of the month and phones from Sony Ericsson are expected to follow.
KTF, the No. 2 mobile carrier, is hoping to edge SK Telecom to become the country's first operator to provide iPhone, while LG Telecom is considering releasing handsets using the Google-backed Android operating systems.
Samsung and LG, which had established a virtual duopoly in the local handset market, are confident of defending their home turf against the impending foreign invasion, but cost competitiveness could prove to be a problem.
T-Omnia, currently the talk of the street, comes with a lavish, 979,000 won (about $745) price tag, and despite all the complicated discount options available, consumers can't get the phones for less than 500,000 won. In comparison, iPhone is selling for around $200 in Japan.
SK Telecom is also charging a hefty 26,000 won per month for T-Omnia users for unlimited data access, which has left many subscribers afraid to try the handset's multiple functions.
And it is hard to predict demand for smart-phones when wireless operators remain reluctant to allow the handsets to support WIFI capabilities
Carriers shudder at the idea of smart-phone users logging on to free WIFI networks, instead of using their expensive pay-per-packet mobile Internet services, not to mention making cheap or free VoIP (voice over Internet protocol) calls from hotspots.
T-Omnia is a rare handset that supports WIFI connectivity, but it is unclear whether operators will be willing to allow the same capabilities on other smart-phone models to be released.