Hello David Wainwright
Broadband penetration in Korea is according to Nielsen/NetRatings in
eMarketer 2001 put it around 50% of households, contrasted to Hong
Kong and Canada with 40%, U.S. at 7% and the U.K. at 3%. Page views
per month were also exceptionally high for Korea at 2,164 compared to
678 for the U.S. and 479 for the U.K.
Koreas incredible broadband figures is due to the fact that the
Government is heavily subsidising the rollout and playing a primary
"The importance of the government's role in deployment of broadband
cannot be underestimated," said Jeong Seon Seol, information and
communications counselor at the Korean Embassy.
...The Korean government, for instance, has made about $77 million in
loans available to fund private networks since 1998. The Korean
government plans to invest about $926 million by 2005 to help deploy
broadband networks around the country.
...High-bandwidth Internet networks are treated as value-added
services in South Korea, and are hence free of most regulations. In
addition, Seol said South Korea has had few copyright disputes since
record companies, recording artists, and other content providers there
are happy to have their works distributed online.
That's not the case in the United States, where the movie and
recording industries have been fighting with the consumer electronics
and PC industries over copy protection schemes aimed at preventing
online pirating of new films and music. Some observers said the
copyright disputes have stymied development of compelling
applications, thereby depressing U.S. demand for broadband services.
Generally speaking, they are well educated and literate. And
technology has been integrated into their culture in many different
ways. Already proficient in text messaging by cell phone, and having
mastered various other technological ways for "keeping in touch,"
participating actively in on-line communities is becoming second
The fact that 95% people in Korea who have an internet connection,
access it through a broadband connection
already puts it on a uneven playing field compared to the U.S. and
You cant feed rich video and audio which is required for an enhanced
gaming experience effectively down a 56k line.
SLOW BROADBAND TAKEUP OUTSIDE KOREA
As an example, the U.K.s broadband rollout has been been a slow and
painful one, hampered by cost, and poor marketing. British Telecom.net
slow to upgrade exchanges due to their claim of low demand (to the
bemusement of some who were crying out for broadband but couldnt get
it), and couldnt justify upgrading each exchange at £250,000 for only
a few users. ISPs couldnt cut prices any further and were working on
very slim margins and still are from BT wholesale. Many ISPs trying
the strategy to sell cheap to build their customer base. However many
users preferred to stay on their unmetered 56k dial up subscriptions
rather than upgrade... and who would pay extra if the average surfing
time was only 6 hours per month?
There is truth in your statement that games (or content) can drive and
fuel the take up of broadband, but in the UKs case many ISPs feel
the rollout by British Telecom the wholesale provider, is incompetent,
and couldnt supply. British Telecom has had its share of problems
which have been echoed in their ISP division BT OpenWorld. Content
providers / I SPs such as AOL dare not touch the infant technology in
the early days.
Without broadband in place there can be no rich gaming experience.
The roll out of broadband in the U.S, U.K. and the rest of Europe is
speeding up. Especially with more competitive consumer pricing but it
simply cannot compete with the subsidies and backing the Korean
government are giving its roll out. Despite prices being cheaper in
the U.S. and the U.K. The far east has the competition licked, e.g. in
Hong Kong the cost of a 1.5Mbit line is the same price as a UK 512k
KOREAS ONLINE GAMING BOOST 1
Starting early helps, and they had the Korean equivalent to internet
cafes called PC-bangs regarded as the most comfortable place for
using the Internet.
In 1998 there were 3,600 PC-Bangs, in August 1999 it jumped to 12,050,
and in May 2000 it was estimated to be around 17,000
These PC-Bangs are almost on every corner and usage is around 1,000
won per hour with free usage for certain registered ISP subscribers.
People normally use the facilities in groups and play online in teams.
Group usage is also being diversified to Internet surfing, chatting,
online stock trading, e-learning. Koreas network team play is
contrasted to western mindsets where generally people like to play
gives a flavour perhaps of the frenzied activity, and the fever that
multiplied the PC-bangs
KOREAS ONLINE GAMING BOOST 2
Not only have the Korean government used public money to help pay for
the broadband infrastructure, its also shelled out on the online
The Korean government has earmarked an additional $14 million in
support of the nation's growing Internet gaming industry, its latest
direct investment in Korea's online development.
Korea's Ministry of Information and Communication, which is known for
its catalytic role in the country's rapid broadband penetration and
its regional advocacy of code division multiple access (CDMA) mobile
phone technologies, said it would help fund and support the online
Even at this early stage, Korea is already among the top developers of
online games, software and services globally.
The ministry said it has earmarked $11 million toward the further
development of Net gaming technologies, including 3-D game engines.
A further $3 million will support the training of online game
specialists, a project to combat online game addiction and industry
"The ministry is seeking to develop the game industry as one of the
nation's top strategic industries," it said in a statement.
In a survey early last year, Internet measurement company NetValue
said 65 percent of all Korean Internet users surveyed visited Net game
Web sites during one month.
A study later in 2001 by Ipsos-Reid predicted that by this year eight
in 10 Internet users 12 to 24 years old in South Korea will have tried
online games at least once.
Adam Creed, Newsbytes SEOUL, SOUTH KOREA, 29 Apr 2002, 5:49 AM CST
ONLINE GAMING MODEL AND STRONG KOREAN DEMAND
Generally speaking, in the U.S., the software packages for MMOGs are
purchased from retailers for $30 to $70 USD. The player then also pays
a monthly subscription fee of $10 to $20 USD to play online. In Korea,
however, the game software is free as a download or on CD-Rom. Then,
players must either have a personal subscription for approximately $20
to $30 USD a month, or pay to play at one of the nearly 20,000
Internet cafes found in Korea.
While the U.S. market counts on the retail sales of the game software
to cover the initial cost of development and the monthly fees to cover
operational expenses, the Korean online gaming revenue, according to
the report, encourages mainstream adoption by lowering initial
barriers and costs. Online games are available to a wide audience at a
low price then, once hooked, players spend heavily on the games and
broadband accounts. Lineage, the most popular game in Korea has around
3 million subscribers out of a population of 47 million.
The remarkable success of the Korean online gaming market apparently
has Sony Online Entertainment, maker of EverQuest, ready to join the
party. In January, Sony announced a deal with NCSoft to have NCsoft
run EverQuest servers and handle customer support for Korean gamers.
Similarly, last August, EA.com announced the launching of Ultima
Online "into the explosive Korean Internet Gaming Room (IGR) market in
source: http://www.gignews.com/koreanonline.htm Feb 2002 GIGnews.com
NCsoft, runs the biggest online game in the world...
Lineage, the company's medieval role-playing game, has more than 4
million subscribers who pay an average monthly subscription fee of
almost $25 to participate in "blood pledge" clans that besiege virtual
castles and slay digital dragons. ...
The vast majority of those subscribers are in NCsoft's home base of
Garriott (of NCsoft) recently talked with ZDNet about the challenges
posed by online gaming and NC's position in the industry. ...
Q: What made Lineage such a phenomenon in Korea?
A: There are obviously a number of factors in Asia. The early reason
is that Lineage was released in 1998, and that's the same time that
the game room phenomenon was taking off in Korea. (Game rooms are
Internet cafe-type shops where game players congregate.) At that time,
they did not have a reason for people to come in and utilize the
computers. It was also a time when Korea was going through a severe
recession, so people had a lot of time on their hands....
And that prompted people to start playing the game at home?
Exactly. If you look at our business two years ago, it was virtually
100 percent game-room business. Now, game rooms represent about 50
percent of our business, and the other half is home users. People
initially got hooked in the game rooms, and then they started buying
PCs and connecting them at home.
How important has broadband penetration been for the growth of
It has been extremely important to our business, and that's because of
our business model, which is very different from something like Sony's
EverQuest. Those business models include buying a box with the game CD
and then paying a fee to play online.
Because we grew up through the game rooms, we came out with a
different model. We've always given away our client for free, and we
do regular upgrades and improvements to the game. The initial client
is now about 400 megabytes, and every two or three months, we come out
with a new episode that might require downloading another 100
megabytes. Doing that over a 56K modem is going to be extremely
Sounds like you have multiple challenges in the United States, then,
given our low broadband penetration and the minor role of game rooms
We do view the US as a challenge. Korea is the No. 1 country in the
world for online gaming, and for that to spill over into the United
States, it will take a continuous rollout of broadband. I think
everyone's been disappointed with how slowly broadband has taken off
in the United States. Once the infrastructure is in place, the
question becomes what games are appropriate in different markets.
Are you adjusting the US version of the game in that regard?
There are a number of things we have been doing to readjust the game
here. One of the most critical issues is that in Korea...you've got a
lot of very experienced players. The game design issues there are how
do you keep experienced players happy? In the US, it's how can we keep
newbie players happy? How can we make sure they have fun right off the
We've developed a newbie zone where they can be safe and protected
until they work up to Level 10. We've redone the graphics; it used to
be that the older parts of the game had all the latest graphics, and
the initial zones looked pretty basic, which doesn't help get new
There's no question tastes are different in Korea. People play in a
very team-oriented way there, partly because the phenomenon really
started in game rooms, where it's very simple to form friendships that
carry over into the game...People here are not as used to getting
together and teaming up as they are in Korea; they like to play solo
By David Becker, Special to ZDNet 26 June 2002 ZDNet Australia
Across the region, (Asia) the number of unique visitors to game sites
is high, but actual usage of games applications is relatively low. The
only exception is Korea: out of the 6,805,540 users who visited a
games website, 5,334,000 (or approximately 80%) of these users
actually played games over the Internet, either via a game application
or directly through the site (Figure 2a & Figure 2b). The actual
number of users playing games is much lower in the remaining markets.
In Taiwan, 582,000 users play online games while China, Hong Kong and
Singapore report less than 100,000 online gamers each.
Clayton Fitts, Vice President of Sales & Marketing, comments on the
Korea phenomenon; "In Korea, we have seen a link between broadband
access and gaming. From our previous reports, we found that over half
of the Korean population is connected to the Internet via broadband
access, either through ADSL or cable connection. Within this broadband
user group, 70 percent play games via the Internet; among
non-broadband users, this figure drops substantially to 38 percent.
Online gaming is very popular with broadband access because it gives
users instant gratification - images are refreshed faster and more
players can interact simultaneously."
KOREAN ONLINE GAMERS PROFILE
Overall, online gamers in Asia tend to be male, 24 years of age or
under and predominantly students (Figure 4). Korea is the exception
where online gamers are almost equally represented by males (55.3%)
and females (44.7%).
The most significant difference in the profiles of online gamers in
Asia relates to the users' connection year. In Taiwan and Korea, a
high proportion of users who played games online were late adopters.
Specifically, 42.1% of Korean and 31.5% of Taiwanese online gamers
first connected to the Internet in year 2000. In the other markets
surveyed, the majority of online gamers had connected to the Internet
prior to 1997.
Commenting on these findings, Mr. Fitts said, "Korea has developed
very quickly and while much of its Internet population is still very
'young' [consisting of mainly late adopters], they are showing very
advanced usage behaviour such as playing online games. This is
evidence that broadband speeds up the e-learning curve for Internet
users. The popularity of the games sector in Asia has shown strong
signs of growth over the past few months - Korea is clearly leading
the way with Taiwan and Hong Kong building up steadily. "
The most visited games websites in Korea (January 2001)
hangame.com 2,868,190 unique visitors
x2game.com 2,805,500 unique visitors
mgame.com 941,440 unique visitors
nexon.co.kr 691,930 unique visitors
egames.co.kr 592,990 unique visitors
Jun 20 2002: Around 18.5 million Internet users in Korea went online
in April, according to NetValue.
Notably the graphical style of most of the above sites was cute
'mario t ype' characters, heavily influenced by Japanese cute manga or
Hello Kitty and Sailor moon cartoons. This style of design appeals to
teenagers and young adults up to 30 year olds and beyond in the Asia
region but does not appeal generally speaking to western adults. So
clearly there is a different mindset here in Korea and Asia.
The other notable difference is almost half of the gamers are female.
March 20, 2001 NetValue Asia
KOREAN CULTURE TO BE A TEAM AND BE THE SAME.
G eert Hofstede wrote an article describing the cultures of fifty
different countries that was published in The International Journal of
Intercultural Relations in 1986. He looked at the cultures of these
fifty countries and characterised them along four different
dimensions. One dimension was the tendency toward what Hofstede called
"collectivism" or "individualism." Collectivist cultures are those
where the focus of the people is on the group rather than the
individual. Individualist cultures are those where the focus is on the
individual rather than the group.
South Korea ranked low on individualism. South Korea was rated at
about 18 on a scale of 12 to 91 on individualism whereas the U.S.A.
rated 91 which was the highest possible score. Hofstede characterised
cultures of countries like South Korea as having low individualism and
high collectivism, and cultures of countries like the U.S.A. as having
high individualism and low collectivism. Other countries with high
individualism scores like the U.S.A. were Australia and Great Britain.
......I didn't understand why the Korean people seemed, in general, so
reticent and unwilling to stand out as individuals when compared to
This Korean collectivism culture also binds groups together, if one
person does, the rest follow, like a group of sheep, or school of
fish. Consequently trends sweep through the Asia Pacific countries
like Korea, (as with Hong Kong, Singapore, Japan) like wild fire.
People want to belong to the same group, be the same, and follow the
same fashions. Westerners tend to be more individual and want to stand
out. Conformity, uniform and regulation are all restrictions to
liberty. Koreans just follow and never question the logic. This
mentality may have assisted the adoption of Koreas broadband and the
popularity of online team gaming.
Mobile gaming is already a hit in Asia -- bringing in an estimated
$827 million revenues in 2001, compared to $20 million in the United
States, according to market researcher Datamonitor. source:
The graphics capabilities of mobile phone displays lack a lot of the
sophistication a computer monitor can offer. The take up of such
mobile gaming will depend on the reception of compromised graphics
especially if a game is ported from a PC.
Westerners are by definition more analytical, individual in mindset,
and can chose not to take on board mobile gaming on the same scale as
Korea, dismissing it as they did tamagotchi (a simple hand held SIM
game with graphics not much better than a Donkey Kong junior handheld
of the early 1980s).
Asian countries loved the tamagotchi, the concept won the day, over
simple graphics. Koreans are perhaps more receptive to a good game
idea, and more forgiving of simple mobile graphics (like tamagotchi).
One person adopts it and so the rest of the market follows, to extend
their networked group, interact and play as a team rather than an
The study by United Kingdom-based Datamonitor predicted growth at 30
per cent a year between 2001, when revenues reached 827 million U.S.
dollars, until 2006.
China is expected to account for 41 per cent of the players, followed
by Japan with 37.4 per cent and South Korea with 10 per cent, it said.
(This market research puts South Korea at only 10 per cent, and not,
one of the projected major players, China is expected to account for
the largest share.)
Revenues are predicted to reach 100 million U.S. dollars in Singapore
by 2006 from 3 million last year, said the study published in The
By Deutsche Presse-Agentur (dpa) , Jul 04 2002
Online games so popular in Korea because
1. Government funded broadband rollout provides the bandwidth
2. 95% broadband penetration of internet users
3. pre-broadband developed online gaming culture from PC-Bangs
4. Koreans mindset to network and play as a team rather than an
5. Online gaming funding also provided by government
6. Almost half of online gamers are females (which may stimulate
opposite sex chat)
7. Koreans spend more time online
8. Koreans projected mobile gaming usage not as high as expected
(according to current statistics)
korean, broadband, penetration
korean, online, gaming, penetration
korean, online, gaming, growth
PC, bang, korea
korean, teenage, pastimes
korean, PC, bangs
mobile, gaming, korea
I hope that helps,
if you need clarification please do not hesitate to ask.
Clarification of Answer by
05 Jul 2002 12:49 PDT
Most of your additional points have been clarified, however some e.g.
picture mobile messaging statistical information, appears to be
unavailable. But I hope what responses there are, helps.
> 14,911,579 households @50% = 7,455,789 (april 2000)
percentage of all homes
> 50% Nielsen/NetRatings;eMarketer, 2001
> According to MIC, the number of broadband Internet subscribers
increased by 50 folds to 1.125622 million households (May 24, 2000)
from 52,378 six months ago. In addition, there are 740,000 subscribers
waiting to have high-speed Internet installed.
> Over 2Mbps Internet access offered at an average fixed line service
charge of 30,000~50,000 won per month.
> Monthly subscription fees for ADSL amount to $22 on average for
residential use and $29.62 for business use, while cable modem by
Thrunet costs $29.62 and $26.5, respectively, for Hanaro Telecom. The
total fee including modem rental is approximately $25 for residential
ADSL and $32.35 for business ADSL and cable modem
old 2000 pricing matrix data on selected countries
trends in prices
> Distribution of free and low-end PC s.
> Increasingly, PC on-line communication service is provided free of
charge to broadband Internet subscribers or LAN users.
> over 2Mbps
why is Korea so different?
Is it delivered through ISPs or through telco?
Who else makes money? Content providers? E commerce? Advertisements
> advertising market in 2000 was 54,000,000,000 won, which grew almost
250% from the 1999 figure. The webcasting market grew from 120
providers in july 1999 to 200 in december 1999, the volume of online
stock trading accounted for 37.0 percent and 69.0 percent of the total
stock transaction in November 1999, and June 2000, respectively
Overall, is broadband a financial success for its providers?
It appears so, but no information to back it
How many players?
>13,212 in 2002
All young males?
>No, online gamers are almost equally represented by males (55.3%) and
Or are there games for otherdemographics?
> No breakdown on other game demographics found
How many play each day/each week/ each month?
>gaming accounts for 19.9% of net access(2002.3)
Is there something specifically Korean about the games?
>team play? Free of charge downloads / CD, western games popular like
Lineage so Korean influence not always neccessary.
For your reference
The most visited games websites in Korea (January 2001)
http://www.hangame.com 2,868,190 unique visitors
http://www.x2game.com 2,805,500 unique visitors
http://www.mgame.com 941,440 unique visitors
http://www.nexon.co.kr 691,930 unique visitors
http://www.egames.co.kr 592,990 unique visitors
What can we learn about online gaming from Korea?
> Government aids both broadband and online gaming industry, they have
2Mps plus bandwidth, teamplay, and sex distribution is almost 50:50
What will need to be changed in UK/EU?
> fully deploy broadband access, increase base speed to at least
make games appeal to the female internet population
How much do people pay to play?
>approximately $20 to $30 USD a month
Is it all monthly subscription?
> Mainly, no information found to prove otherwise
Have any other models been tried?
> No information found to prove otherwise
Are prizes available?
> Yes prizes and money, some are professional
Is it ever linked to gambling?
> There is gambling online
Do these games need broadband?
>Evidence suggests that broadband is needed for the full experience
Will they act as a stimulus to broadband here?
> Yes, maybe, no direct evidence in Korea but in Hong Kong Sony are
forging relationships with broadband suppliers
Did games or broadband come first in Korea?
> Gaming in PC-bang internet centres came first, then residential
broadband allowed people to take it home with them. Korea grew up
with games rooms.
What other broadband content works?
> Search accounts for 58.1% of access, recreation/game 19.9%, email
14.8%, study 3.1%, chatting 1.5%, money transaction/inquiry 1.3%,
73.9% of Korean internet population had used audio or video in
Is pornography important?
> ...a four-country report by NetValue shows. Some 10.7 million South
Koreans headed to adult sites in March, a hefty 72 percent jump from
the year before
Is broadband used for education to any significant extent?
> Some distance learning is being trialled
otherwise no evidence of online distance learning from the
Is it paid for?
> No information
Does the government subsidise it at all?
> No information
Is there a working revenue model for education?
What about video downloads?
> 73.9% of Korean internet population had used audio or video in
Is this happening to any significant extent? Or music?
> appears to be, but no statistical information to back it
Is this all pirate?
> Indonesia, the Philippines, Singapore, South Korea and Taiwan have
piracy levels between 10 to 25 percent. Reuters May 16, 2001 PDT
Or are there working models for legitimate purchase of content?
How many picture phones subscribers now in Korea?
> No information found, but 14 million of 26 million mobile phone
subscribers also subscribe to wireless internet services
How much are the handsets?
(The price of the cheapest one on the market and an approximate range
would be useful).
Which handset manufacturers appear to be doing well?
> Samsung, LG Elec
> Samsung SK Telecom partner
LG Elec KT corp partner,
(Networks: SK Telecom wth 53.30% no. 1 market share, and KTF at 32.80%
number 2 (2002.07.04)
How much does it cost to send a picture?
> No information found
How many pictures does the average users send every month?
> No information found
What are the demographics of picture phone use?
> No information found
Is it primarily young females?
> No information found
What sort of pictures do they send?
> No information found
What do you think of the quality?
> No information found
Is it variable, or is it always OK?
> No information found
What lessons should European operators learn from the Korean
> according to Light Surf California ( http://www.lightsurf.com/ )
"In our view, the reason photo messaging hasn't taken off in Europe
and North America is due to the lack of availability of large-screen,
color handsets. We think it will launch late this year, and be huge
next year," predicts Robin Nijor, vice president of Marketing at
LightSurf. "We've demonstrated the ability to share high-quality VGA
color photos in less than 60 seconds over today's 2G and 2.5G networks
in North America. LightSurf has a lot of expertise in optimal image
delivery. Of course, with 3G networks, we'll be able to do everything
much faster. But, we never looked at 3G verses 2G as the reason photo
messaging hasn't taken off. It's due to the lackluster user experience
on today's devices - typical monochrome handsets don't provide what's
> per byte from around 2p per byte
> £180 + camera £130
> No information on Korea
> No information on Korea
What about video phones?
> Video mobile phones, yes
Is this happening yet?
> 31st May, 2002
Gemplus and KT ICOM announced they will be providing W-CDMA trial
services during the 2002 FIFA World Cup Korea/Japan including video
phone and video-on-demand capabilities. Hundreds of people including
World Cup Officials will trial these introductory services at the
World Cup Plaza located in five major stadiums and downtown Seoul and
Busan during the World Cup period.
Customers will be able to make standard voice calls as well as
videophone calls, while benefiting from new multimedia-based services
such as video-on-demand by watching games and recalling football
scores via KT ICOM handsets.
Do they work effectively?
No negative feedback found.
What is happening in this area?
> The SK Group, one of the largest conglomerates in Korea, is
striving to bring IP Television to Korea. An important aspect of
Koreas infrastructure is the abundance of bandwidth and comparative
lack of video services like cable, broadcast or satellite television.
For SK, this fortunate combination spells opportunity. With the
availability of fiber weaving its way throughout many of the multiple
dwelling units (MDUs) in Korea and the accessibility of that bandwidth
to its residents, SK is uniquely positioned to create a superior
video service for virtually every home throughout the country
(TV over DSL)
Is it all games and quizzes, or is there something more sophisticated?
> seems to be little activity, no information