"South Koreans spent more than $1.6bn shopping online in the first
quarter of 2004, twice as much per capita as US consumers"
http://digiens.blogspot.com/2005/11/koreas-digital-wave-travels-far.html
Korea’s digital wave travels far
South Korea’s Digital Media City is intended to be a world-class
centre for media content development, production and distribution.
With Korean culture spreading across Asia and beyond through online
games and TV shows, the new city is expected to reap the benefits.
Across Asia, schoolchildren of all ages spend a large proportion of
their free time in internet cafes competing against each other in
various amazingly animated online computer games. Many, or perhaps
most, of the games being played come from South Korea and mark the
quiet infiltration of Korean culture across the region.
This infiltration extends beyond the computer screen: teenagers and
young adults in many parts of Asia are also hooked on Korean soap
operas and sing along to Korean boy bands. Hallyu (the Korean Wave)
has hit Asia and it looks as if its influence is spreading further
afield: Americans are tuning into the lives and loves of everyday
Koreans with several soap operas being broadcast on US television,
and Europeans are using multi-player online games.
Well known as having the world’s most internet-savvy population, with
the highest per capita broadband access (about 82% of the nation’s 48
million people have access to the internet and a flow up to 10 times
faster than anywhere else in the world), the country is revelling in
its position as a world leader in digital media content. The growth
of the knowledge-based society in Korea has been the subject of many
studies. One of them, a 2002 Organisation for Economic Co-operation
and Development survey, showed how the Korean government has
digitalised five main areas of society including, education, history,
science and technology, culture and telecommunications. South Koreans
spent more than $1.6bn shopping online in the first quarter of 2004,
twice as much per capita as US consumers.
The rapid growth of the ultimate broadband-based society prompted
Intel to create a research and development (R&D) centre in Seoul in
2004 focusing on digital content and platforms to provide consumers
with the best quality content – movies, music, games, photos,
communication and information – anytime, anywhere and on any device.
Government effort
The creation of a country of ‘netizens’, as the Korean population is
now called, is the result of a concerted effort by the national
government to provide the right regulatory framework to encourage
competition and to ensure that the best possible infrastructure has
been put in place. With the country now firmly established as a
technology leader and the cultural impact manifesting itself in the
Korean Wave, the government is building on this expertise and further
developing the economy through the creation of a digital media
cluster that can take advantage of its position as the leader in a
regional market of 1.7 billion consumers.
In 2002, the Seoul Metropolitan Government made the decision to
locate a media and entertainment cluster in the
SangamNewMillenniumTown, a $1.3bn development north-west of the
capital. The town houses the 2002 FIFA World Cup stadium, an
ecological park and intelligent residential homes.
Digital Media City
The Digital Media City (DMC), which is due to be completed in 2010,
will be the centrepiece of Sangam and is intended to be the world’s
best media content development, production and distribution centre,
and an R&D cluster for the media and entertainment field, including
broadcasting, film, animation, gaming, music and e-education, and the
IT and software industries. There will also be development of general
business facilities, hotels (US hotel chain Stanford has already
invested $30m in the development), an entertainment complex and
shopping centres.
The city is expected to develop into a tourist attraction with
Digital Media Street, which will run through the centre, exhibiting
futuristic ‘Intel-lights’ which brighten as people approach them, and
‘etherbeetles’, small, electric-powered, intelligent personal
transporters that are equipped with voice-recognition software.
DMC serves as a benchmark for other locations that are developing
digital media content clusters. The city aims to be one of the most
successful information and media complexes in the world. Many
countries, including the US, the UK, France, Netherlands, Canada,
Finland, Japan, Singapore, Malaysia and others have similar plans to
develop clusters like DMC and some have visited the project.
City funding
Just as the Korean government has been the driving force behind the
technological revolution in the country, Seoul Metropolitan
Government has given full funding to the DMC. Generous funding allows
the DMC to offer attractive incentives to entice foreign investors,
which will help to generate the reputation of the cluster.
Land parcels in the DMC are provided at low cost, half the market
price, to foreign companies and serviced with a direct contract with
the city government to minimise red tape. The city government also
provides full administrative support, linking developers and tenant
firms to reduce business risk. There is a 100% tax exemption for the
first five years and 50% reduction for a further two years from
corporate and income taxes.
These incentives, coupled with the prestige of Korea’s digital media
content industry, have already attracted foreign institutes and
companies. The total investment to date amounts to $350m. To
emphasise the DMC’s reputation for R&D, the Korean German Institute
of Technology (KGIT), a consortium of 10 leading German universities,
has chosen to base itself there to take advantage of local expertise
and pursue joint research projects with other resident companies.
R&D environment
The DMC cluster provides a perfect environment for joint research
projects, according to Professor Ingo Wolff: “In Korea there is an
atmosphere of innovation. Young people here are very active, very
future oriented. Korea is the centre of Asia and we wanted to set our
institute in Seoul. DMC was the perfect fit, as the activities we
will be undertaking are very well suited to the DMC concept.
“The KGIT project is the first time ever that 10 leading German
universities have come together in a consortium to invest; what we
are building is a centre of research and academic excellence. The
main research areas for KGIT’s 400-450 scientists include
communications and media technologies, all areas of IT, nano-
technology, cultural content, film design and technological management.”
Negotiations are under way with the US-based Carnegie Mellon
Institute to locate R&D facilities in the DMC. Many organisations
like these are drawn by the idea that some of Korea’s most
prestigious digital media content and related companies and
organisations will be located there.
The Ministry of Information and Communication’s IT Complex and the
Ministry of Culture and Tourism’s Culture and Content Complex, which
supports the development of the multimedia industry in Korea, is
based in the city. Game portal, publishing and development firm Actoz
Soft, plans to locate its head office there. The Korean Broadcasting
System subsidiary, KBS Media, plans to base its head office in the
city, too.
Byung-soon Lee, president of KBS Media, emphasises that the company
is making every effort to develop itself, “We are actively engaged in
the constant commissioning and production of content. DMC offers an
excellent environment for us to do exactly that, and to take our
programming to a new level. We anticipate DMC being not only a space
in which a blending of film, animation, music and other media can
take place, but also a hotbed of international creativity.”
Living laboratory
Byeon-yeop Park, president of Pantech & Curitel, a Korean mobile
phone manufacturer, regards the DMC as “a living laboratory” for the
latest developments in hardware and software, and the kind of content
that next generation users will require and want.
From this year, Seoul city is providing plots of land for the
construction of a landmark building site and an urban entertainment
centre which will play an important role in the development of an
international business hub. By 2006, the DMC will have public support
buildings that will offer low-cost, long-term lease office space for
foreign firms and investors, and will house the R&D Centre for Co-
operation between Industry and Academy, a high-tech industrial centre
and serviced apartments.
Apart from the business services offered in the cluster, the DMC is a
15-minute underground train ride away from the centre of Seoul, where
there is access to international financial, consulting, legal and
technical support. The capital is home to 6000 venture capital
companies, many of which specialise in the high-tech sector.
The creation of DMC is an endeavour to ensure that South Korea’s
vision of a digital culture is not just found in R&D laboratories but
is properly commercialised and exported to the rest of the world.
GAMES: THE KOREAN WAVE GENERATOR
South Korea’s online games obsession hit the headlines earlier this
year when a young man died after playing for 50 hours straight. The
product of PC Baangs (internet cafes, of which there are about 28,000
in the country), the online games sector is now worth about $397m. It
has become extremely popular in Asia and the export of Korean online
games has boomed since a concerted promotion effort in 2004.
By the end of the year, Korean online games contributed 51.4% to
total online games (154 games) in the Chinese market. As broadband is
now more commonplace in Europe and the US, online game-playing is
expected to grow rapidly with the help of Korean exports. DFC
Intelligence, a multimedia research company based in the US,
estimates that the online game industry in 2003 was worth $1.9bn,
with more than 50% of the revenue coming from Asia and 10% of revenue
coming from Europe. By 2006, this revenue will grow to $5.2bn with
worldwide revenue reaching $9.8bn by 2009, the company forecasts.
Asia will remain the largest market but Europe will be the fastest
growing market with revenues reaching $2.2bn.
By the end of 2004, wireless internet use in Korea had increased 4.1%
to 40.2%. Thanks to more sophisticated and functional mobile
handsets, expectation and growth potential of the mobile games sector
is high. Revenues of mobile games in Korea in 2004 stood at $135m
with a growth rate double that of the PC standalone game market for
the consecutive two years from 2003.
As the supply of high-functional handsets expands, not only in Asia
but also in Europe and the US, the time of high-capacity 3D games is
unfolding. Mobile games are expected to have more colourful graphics
and a greater variety of content as handset functions improve and
exclusive game handsets become popular.
October 03, 2005
http://www.fdimagazine.com/news
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