With gamification, banks build profit by adding fun

A 39-year-old with the surname Yim plays “My Love Dokdo” on his smartphone whenever he has time – not just because the game is addictive, but because it can garner him a better interest rate on his online banking account.

“I started playing it because if I reach level 20 the interest rate on my account will automatically go up 0.5 percentage point,” said Yim, who recently opened a “My Love Dokdo Cyber Fixed Deposit” account with NH Nonghyup.

As smartphones and tablet PCs become ever-more ubiquitous, local financial companies are grafting games to their online banking systems to attract new customers. The trend is dubbed gamification, which refers to the use of game mechanics and game design techniques in non-game contexts.

One of the most successful examples of this has come from Nike. When runners wear the brand’s sneakers equipped with a sensor called Nike Plus, it calculates the number of calories burned, measures the workout time and distance, and sends them the information online.

When they reach their pre-set workout target, the company awards them a trophy online. Users can also upload their records on social networking services and compete with their friends. More than 2 million people worldwide now subscribe to the service.

For full article, see Joongang Daily.

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Koreans to lead digital lifestyle with 11 gadgets

From GPS-enabled sunglasses to digital umbrellas, Koreans will use more mobile-connected devices per capita than any other country by 2020, the Global System for Mobile Communications Association (GSMA) said on Tuesday.

The GSMA said there will be 24 billion mobile connections in the world by that date presenting a $4.5 trillion market opportunity for companies that adopt mobile technology into their business models.

Koreans are estimated to own more than 10 such devices within the next decade as the nation’s legions of early adopters move to embrace a digitally ubiquitous living environment.

“We estimate that South Korea will be a country that has the world’s highest share of the number of connected mobile devices per capita in 10 years,” said Ana Lattibeaudiere, head of the GSMA’s connected living program, during a press conference at the Connected Living Asia Summit at COEX in southern Seoul on Tuesday.

For full article see Joongang Daily.

Korea’s online economy share in GDP records 2nd highest in world: report

South Korea’s online economy accounted for 7.3 percent, or $75 billion, of the nation’s gross domestic product (GDP) as of 2010, according to a report. The Korean online economy took a larger share in GDP than those of Japan and the US, and it is second only to the UK among the Group of 20 (G20) countries.

Korea’s online economy is expected to grow 7.4 percent on annual average for upcoming four years, according to global consulting firm Boston Consulting Group’s (BCG’s) report exclusively obtained by Maeil Business Newspaper Monday. The nation’s online economy-to-GDP ratio is forecast to expand to the eight percent level by 2016 and the economy will amount to $114 billion in size, the report projected.

BCG made the first attempt to systematically calculate sizes of G20 countries’ online economy adopting uniformed standards and methodologies. By industry, the ratio of the online economy to Korea’s GDP is fifth largest after Korea’s manufacturing industry (30.6 percent), services in public and private sectors (18 percent), real estate, and the distribution/hotel sector. The online economy took larger share in GDP than those of the financial service/ insurance sector and the construction industry in Korea.

For full article see Maeil Business.

Smartphones changing how we take our drugs

The Ministry of Health and Welfare, together with the National Health Insurance Corporation, the Health Insurance Review and Assessment Service, the Korea National Council of Consumer Organization and the Korea Organization for Patient Group announced that there’s a “smarter way to take drugs.”  By using a smartphone application, consumers will be able to know everything about the medicine they are taking, including prices, upon typing in the name of the drug.

The app, titled “Health Information” in Korean, even suggests a list of alternative medicines with the same makeup but at cheaper prices to allow consumers to “smartly select and purchase drugs of their choice.” According to the Health Ministry, the consumption of pharmaceutical drugs has increased every year, which in turn, has increased the financial burden on the country’s health insurance as the cost of drugs has increased by 13.2 percent from 2001 to 2010.

For full article see Joongang Daily.

Mobile carriers’ investment up 20 pct in 2011

South Korean mobile carriers’ investment rose 20 percent in 2011 from a year earlier mainly on increased spending to build high-speed long-term evolution (LTE) networks, the telecommunications watchdog said Thursday.

The three mobile carriers including top player SK Telecom Co. spent 7.67 trillion won (US$6.86 billion) on investment in 2011, compared with 6.4 trillion won a year earlier, according to the Korea Communications Commission (KCC).

The watchdog said that local mobile carriers spent more money last year to cope with growing demand for wireless services and brace for the impact from newly launched LTE services.  SK Telecom and LG Uplus Corp., the country’s smallest mobile carrier, launched their LTE services last July to meet subscribers’ increasing demand for accessing data at a faster pace.

For full article see Yonhap News.

SERI report: Korea’s IT industry in transition

IT has become a mainstay of Korea’s export driven economy, and aggressive investments have made Korean firms into dominant players in semiconductors, LCD panels, and mobile phones. Despite their success, new challenges await Korean firms in the form of increased competition from China, and pressure to diversify into components and software.

Korea’s IT and electronics industry began with assembly of radio sets in the 1950s. By the 1980s, Korean firms had moved into semiconductor production, and by the 1990s, Korean firms were producing high quality consumer electronics and exploring high-speed Internet services. IT is now one of the nation’s backbone industries, accounting for nearly 11 percent of GDP, and 33 percent of exports in 2010. Korea’s IT success has thus far been mostly a hardware phenomenon, but Korean firms are now increasingly looking into software as the industry evolves.

Korea’s IT exports reached $158.8 billion in 2011, a three-fold increase from 2001. Share for the IT industry in exports is characteristically high, peaking at 39 percent in 2004, though this is expected to decline to 29 percent in 2011. The trade surplus for IT, moreover, has consistently outstripped the nation’s overall trade balance since 2001. Even during the global financial crisis of 2008, when Korea posted a trade deficit of $13 billion, the IT industry recorded a surplus of $58 billion. Korean IT has also been a strong performer in comparison to other nations. After ranking third in the world from 2005 to 2008, Korean IT’s trade balance overtook Japan in 2009 and 2010 to take the No. 2 spot behind China. In terms of IT export volume, Korea climbed to 5th in the world in 2009 from 10th in 2001, greatly narrowing the gap with No. 4 Japan.

For full report see SERI. Free subscription required.

Mobile carriers race to grab bigger slice of LTE market

South Korea’s top mobile carrier SK Telecom Co. and other industry players are ramping up efforts to claim a bigger share of the fast growing long-term evolution (LTE) market deemed a future money spinner, market watchers say. The LTE service, or the fourth-generation (4G) of wireless technology, enables smartphone users to access a stream of data faster than the current 3G network and download and watch movies more quickly.

In a country where four out of 10 people use smartphones, SK Telecom and two other carriers — KT Corp. and LG Uplus Corp. — are rushing to satisfy data-hungry users, betting that the new service will help them continue to turn a profit in the already saturated wireless market. “Offering the LTE service can be likened to expanding a congested road to make traffic flow more smoothly,” said Kim Jang-won, a senior analyst at IBK Securities Co. 

The LTE service kicked off in July last year in South Korea, led by SK Telecom, which controls about half of the local mobile market, and LG Uplus, the country’s smallest mobile operator.

For full article see Yonhap News.

Robust growth expected for IT giants

Korea’s information technology firms are expected to either see robust growth or get back on track in 2012.

They will continue to take a leading position in the industry by rolling out new and innovative premium electronic goods like smartphones and 3-D capable smart televisions, while local mobile carriers will move to quickly adapt to the upgraded fourth generation network technology.

Online portals are also expected to center their attention on mobile advertising and mobile messaging to widen their business portfolio for 2012.

Here are the outlooks for major Korean IT firms for this year:

For full article see Korea Herald.

Lessons Learned from South Korea’s real-name verification system

In 2002, Korean democracy made headlines around the world when an unknown entrepreuneur launched the world’s first citizen journalism web site OhMyNews, which helped deliver the highest chair in the country to the underdog liberal candidate Roh Moo-hyun.  Roh won the extremely contested election with just half a million votes, through an active online campaign supported and driven by an idealistic and net-savvy youth.  

Since then, the Korean government has had an extremely hands-on approach to governing online expression.  South Korean bureaucracy dealing with controlling online discourse has ballooned since 2003.  After several permutations, South Korea currently has two agencies that monitor online activity during elections, the Internet Election News Deliberation Commission (IENDC) that oversees online press, and the Cyber Censorship Team (CCT), which monitors user-generated content and non-media web sites.  The agencies have the right to remove content at their discretion.  During the 2007 elections, the two agencies removed over 100,000 blog posts, comments, articles and 65,000 videos online.

In 2003, the conservative Grand National Party (GNP) struck back from losing the presidential race by enacting a new law which required online users to verify their real identities before posting comments on election-related web sites.  The legislation’s stated goals were to to promote responsible online discourse and to protect the privacy of candidates, and it has accomplished its purpose to a limited extent.  Yet the greater underlying political motive is clear to see — the conservative party that relies on older, less internet-savvy Koreans wanted to limit the influence of online media on election results.  In 2007, an election year, the proliferation of anonymous online slander was the stated cause for extending the real-name system to web sites with over 300,000 daily visits

For full article see Korea IT Times.

Smart devices boost online music sales

The number of smartphone users in Korea surpassed the 20 million mark last year. The penetration rate is expected to exceed 70 percent of the population within the year. With their smartphones or tablet PCs, people carry an MP3 player with them virtually all the time.

The fast adoption of smart devices has also driven online music sales in Korea more quickly than in any other country. 

According to the International Federation of the Phonographic Industry, digital music revenues reached $4.6 billion globally in 2010, accounting for 29 percent of record companies’ trade revenue.

In Korea, the digital music industry saw a more than 10 percent increase in 2010, accounting for up 80 percent of total music sales here. The Korea Creative Contents Agency (KOCCA) said that online music sales reached 622.2 billion won ($540 million).

While offline music sales remain sluggish, online sales are to dominate up to 90 percent of total music sales here in 2014, industry watchers expect.

For full article see Korea Herald.