Patent royalties threaten new mobile service

JoongAng Daily. May 26, 2004
By Yum Tae-jung, Wohn Dong-heePatent royalties are posing threats to a new digital mobile broadcasting service in
Korea before it is even launched. Digital mobile broadcasting, or DMB, is a service that enables users to view television through cellular phones by means of satellite transmission.
TU Media Corp. announced yesterday that Toshiba Corp., the Japanese company that holds the core technology for satellite mobile broadcasting, is demanding royalties for terminals sold in
Korea. TU said Toshiba requested royalties of 2 percent per terminal for all gadgets that will use the satellite broadcasting service. TU Media is a consortium led by SK Telecom that will control digital mobile broadcasting in
Korea. The service is scheduled to begin in September.
“We have talked with handset producers such as Samsung Electronics, and we have made a decision not to accept Toshiba’s request,” an official at TU Media said. “Next week, we plan to visit
Japan and discuss this.”
TU Media and cellular phone manufacturers said that they plan to negotiate on paying a fixed royalty for a certain bulk number of handsets, instead of on each handset.
Aside from royalties imposed on systems technology, there are royalties on voice compression, and separate fees that must be paid to Qualcomm, which holds patents for code division multiple access, or CDMA, technology. Korean companies commercialized the technology for the first time, and had paid more than 2 trillion won ($1.7 billion) in royalties to Qualcomm as of March.
Increasing cellular phone exports to
Europe are also triggering royalty claims. Phones shipped to Europe must support the Global System for
Mobile communication, or GSM, the European standard. Recently, however, companies that claim to hold the source technologies are asking Korean handset makers for royalties.
In most cases, cellular phone production works on a cross-license basis, where companies exchange technologies. Large companies, such as Samsung Electronics, do not have much to worry about since they already hold many GSM-related patents that they can swap, but smaller companies may be faced with higher royalty costs.

Internet game players’ group threatens suit against NC Soft

JoongAng Daily. May 21, 2004
By Wohn Dong-hee

Online game players are threatening to file a class action suit against NC Soft, Korea’s largest Internet game developer and publisher. They claim the fees to play the game Lineage are too high and that the company has been negligent in attending to various technical and ethical problems involving the game.
The Online Consumers League, an Internet-based civic group, sent a statement, signed by 1,060 members, to NC Soft yesterday, notifying the company that it would file the suit.
The league claims that the game is too expensive. It noted that the monthly fee of 30,000 won ($25.40) was almost double the rate in some other countries. Monthly rates are $15 in the United States, 2,000 yen ($17.60) in Japan, and $480 NT ($14) in Taiwan. “Korean game players are being discriminated against,” they said.
The league also said that the game’s server crashed too often, and that there was significant fraud or hacking of the game, yet the company has not taken action to improve conditions. They said that they would file the suit if the company did not act by May 28.
Recently, users have informally asked many other online game developers to lower their charges as well.
In this year’s first quarter, NC Soft reported sales of 60.9 billion won and operating profits of 31.7 billion won. “It is difficult to make a comparison with other countries because the market itself is different,” said Kim Ju-young, the company’s public relations director. “Also, compared to other modes of entertainment here in Korea, the charges are still very low.”
Another problem that users pointed out was the cash trading of game items offline. Within the game, there are many different “items” such as weapons, clothing or potions, that have different levels of power. Acquiring more powerful items can take hours of playing time. The ability to acquire more powerful items also depends on the level of skill of the player. Therefore, for players unable or unwilling to devote the necessary time, buying and selling items for cash has become a widespread trend.
“Offline or online trading of items has nothing to do with the company,” a company official said. “If it is illegal, then the government should make a law forbidding cash trade of online items,” the official added.
Many users, however, disagree. “The basic structure of online games is that if one has good items and equipment, then he or she can win,” one game player said.
Since the game was launched in 1999, 520 million accounts have been opened in Korea alone. That figure can include multiple accounts for an individual subscriber.

Innovation key for PC makers

JoongAng Daily. May 20, 2004
By Wohn Dong-heeGiven the fast-paced evolution of technology, developers of personal computers should think “outside the box” for new, innovative ideas, a senior Sony official said yesterday.
Kunimasha Suzuki, senior general manager of Sony Corp. in Tokyo, was visiting
Korea to attend a launching ceremony for Sony’s new VAIO laptop computer.
“Seven years ago, when we launched VAIO, the personal computer was regarded as a business tool, an extension of the office PC,” Mr. Suzuki said. “Using computers for audio and video content has become mainstream these days, but it was not always so. That is why we must advance PC products so that they are not held back by the constraints of conventional concepts.”
He said that
Korea was a good place to apply emerging technologies. “
Korea is a growing market that is based on an infrastructure which has a high broadband penetration rate. New products that have just been announced in
Japan will be brought here immediately to be adapted,” he said.
He said that Sony is taking further steps to converge audio-visual and information technologies. The main change is that the VAIO, originally a laptop brand, will be expanded to include entertainment and networking solutions.
In addition to two new laptop computers, Sony Korea introduced the VAIO type U, a micro-mini Windows XP computer, and the VAIO Pocket, the Sony version of the Macintosh iPod. These next-generation high-tech gadgets support large music and digital image files, and can be used interactively with existing audio and video media.

New music albums go mobile

JoongAng Daily. May 20, 2004
By Wohn Dong-hee

In the past, pop singers released their newest music through CDs. Now, the sluggish music industry is making a new attempt to survive by releasing single songs through new digital channels.On Monday, such famous Korean pop singers as Lee Hyo-lee, Brown Eyed Soul, Shinhwa and Seven began offering their music in cyberspace. The new singles can be downloaded to cellular phones or be played at certain music portal sites on the Internet.
The concept of providing music through files instead of conventional audio materials such as compact discs or cassette tapes is not new. Last June, Ricky Martin promoted his new album only through mobile service. The difference, however, is that these songs were created solely for the purpose of digital distribution ― and more out of desperation than a search for a new promotion tool.

“Illegal music distribution through the Internet and the continuing economic recession are damaging the music industry. Since cultural trends are changing, we have to change the way we distribute music too,” said Jang Seok-woo, president of Aodio, a music entertainment agency that will begin producing “digital” singles. “What is also exciting is that with emerging artists, we can produce music that caters just to mobile users’ needs. Depending on who the target listener is, we can select the music genre, type of voice, and lyrics that they will like,” Mr. Jang added. On the cellular phone, these new singles will be available through SK Telecom’s wireless service for 900 won ($ 0.76) per song. “The music files for mobile singles are very high in quality. It will be different than listening to music through the radio or television,” said SK mobile PR division’s Kim Jun-sung. “The music can also be integrated with existing mobile services, and be used as ringing tones, connecting tunes or karaoke.”Music production companies are aiming in the long run to make these wireless channels the main distribution market.
“CD production costs are massive, but digital distribution is so much more cost-efficient. Also, since high-speed Internet connection and wireless service is so widespread in Korea, we don’t think it will take a lot of time to adapt to this new method of publishing art,” said Shin Min-kyung, media director of Good Entertainment. “Musicians are pretty cooperative as well. They weren’t keen about the idea at first, but they’ve seen MP3 files rampage through the Web, and they realize that they have to go with the tide,” he said.