Web 2.0 Asia

SK Telecom, Korea's top mobile carrier, is rumored (link in Korean) to be undertaking a secret project called "Project G", or "Project Giant". 

What SKT wants to achieve through Project G is a bit murky now, but apparently the telecom giant wants to create a better mobile phone software platform, with a much improved UI (user interface). The platform/UI will likely see the light in new lines of handsets, to be OEMed by companies like HTC of Taiwan. 

All in all, this sounds very much like creating an iPhone- (or Android-) fighter. This comes on the heels of the news that SKT is also planning its own App store, a la iPhone App store. It remains to be seen if SKT's efforts to create yet another iPhone-like ecosystem will turn out ot be a good decision. But the project's codename "Giant" certainly shows the company hopes their new platform/UI/apps strategy to take off big time. 

Korea has had its own version of March Madness, in the name of World Baseball Classic. Korean team won the silver medal in a close nail-biter against Japan. What a match. 

Now the games are over, and it's not only the players, some of whom have gained great visibility and along with that a better chance to play in the Majors when they become free agents, who have benefited big time from the World Baseball Classic. On the side of the Korean players' helmet was the advertisement of an online game "Magoo Magoo", and the game saw a great traffic surge thanks to that helmet ad.  

"Magoo" (魔球) means "crazyball" in Korean. The online game allows players to recruit real players - so it's the combination of fantasy baseball and online baseball game. The game is already hugely popular among Korean game players, but the helmet ad only added to its popularity: CJ Internet (service provider of Magoo Magoo) says the game saw a traffic growth of up to 220% during the World Baseball Classic. 

The fact that the national baseball team's sponsor was an online game service is something that I can't think of would be the case for other countries, and I think that just about shows how much Koreans embrace online games. 

On a separate note, another recent news about Korean online gaming industry is that AION, the new game from NC Soft, the largest online game service provider in Korea famous for Lineage series, seems to have hit another jackpot for the company. NC Soft is aiming to reach $1bn revenue mark with AION, a feat that the company had already achieved with Lineage. 

Now, the beauty of online games market is that one hit product doesn't necessarily canibalize into the market of another hit product. That means NC Soft is already raking in good money with its Lineage series, and on top of that, there is a fresh influx of revenues from AION. NC Soft's revenue can effectively double - which explains the recent surge of its stock price. 

My personal mission statement (at least for the chapter of my life I'm in now) is to take Korean/Asian innovation to the world outside. That's what I do in my day job - We are integrating our product with Google infrastructure and hopefully we'll launch globally later on - and that's also what I do in my off-work hours, from writing this blog to organizing the first-ever premier pan-Asian conference where the East meets the West. 

In doing so, I am faced with this question a lot: Will it be possible to create another Silicon Valley, let's say in Asia? And I'm certainly not the only one who asks such question. Paul Graham instantly pops into my mind. 

All this time, I have been someone who would say the notion of "one and only one Silicon Valley in the world" is silly. Look at Microsoft, Myspace, QQ, Nintendo, Nokia - none of them are Valley companies - I would argue. But after my extended stay in the Bay Area this time, I now find myself believing, maybe Silicon Valley *is* a thing of its own and it is virtually impossible to duplicate it. 

Why? For me, it seems to come down to this single virtue: the accessibility. 

During my stay in the Valley, I was lucky enough to meet with some of the "venture celebrities" I had seen only on news. As they say, Valley is a small society, where everyone kind of knows everyone else. And people are not merely "open" to make intros, they even sometimes seem eager to make those intros. Somehow they want to open doors for me. So what happens is, while I'm meeting someone, if I mention this person's name that I saw on tech news in the morning (whom I would have never expected to be able to meet if I was in Korea), the guy I"m meeting with goes like, "Oh, I did my previous startup with him and hung out with him in the bar the other night - would you like to meet him?" And I'm like, damn, was it that easy? 

Try the same thing in, let's say, Korea. You want to meet the "movers and shakers" of the industry? You will probably have to meet their secretaries first. You have this crazy idea that you think will change the world? You will likely find there's not enough capital or other necessary ingredients that will let you build a business around that idea. So the next thing you do is to bring that idea to this established company, most likely a portal or a big company's IT arm. If they don't understand what the heck you are talking about (which is the most likely scenario), they will basically tell you to get a real job. If they do see the potential, they will either try to rip you off by offering a cheap labor opportunity on an exclusive business deal, or copy the idea altogether. 

Of course I shouldn't generalize the picture too much. But I'm not miscarrying the reality too much either. It indeed is so different. The accessibility of the Valley just isn't there anywhere else, especially Asia. None of this is a secret, I know - we've read about the Valley stories so many times. And it's not like I came to the Valley for the first time either. But knowing something and living it are completely different, and for however brief time I was in the Valley this time, I "lived it" and it feels so different. 

High accessibility means higher chance for smart people to bump into each other and bounce off ideas with each other. World-changing innovations often come from such intellectual interactions. As long as the Valley maintains its high accessibility, I believe it will remain as the mecca of tech innovations. By now you would have understood at least one reason why Korea can't create another Silicon Valley, and for that matter, how to create one. 

SK Communications is an affiliate of a Korean conglomerate SK Group. SK Comms has the famous Cyworld and a major Korean web portal Nate.com. Nate offers Korea's most popular IM service, Nate On Messenger. SK Comms tries to create synergy among these assets, namely Cyworld, Nate portal, and Nate On Messenger. 

As a part of such effort, SK Comms has created a knowledge Q&A service that is integrated with its Nate On Messenger. You ask a question using the IM, and someone pings back with an answer. As you actively participate in this knowledge Q&A process, you earn "knowledge mileage" which you can later redeem for Cyworld virtual money (Dotori). 

The concept of the Nate Q&A service seems to be exactly the same as that of Aardvark, a new US service from ex-Googlers. However, while Aardvark is starting from a zero user base and is aggregating users through invitations, SK Comms has a leg up as it already has a great user base and can leverage on that immediately. According to SK Comms, the average turnout speed (i.e. how long it takes for a question to be answered) is less than 10 minutes (I think it's amazing). On average, Nate Q&A gets 1,000 questions and 3,000 answers daily. After the IM integration, Nate Q&A saw an increase of 22.3% in terms of the answers posted. 

From startups to big companies like Amazon and Facebook, social knowledge filtering and recommendation seem to be one of the hottest topics. The devils would be in the details, and particular challenge would lie in accurately capturing user's interest and expertise. I think this issue is also related to monetization of social network, another important issue, as the flip side of social filtering would be social advertising (such as friends' endorsement). Nate Q&A attempts to untie the first knot by creating a instant knowledge exchange flow - a big first step towards the holy grail.

This is another dug-up news from the past week (the news have been slow anyway). Korean government has disclosed plan to set up the "Global Game Hub" in Bundang/Pangyo area, a "new city" to the south of Seoul. 

It seems like the Korean government has this unending love affair with the "Hub" thing. The Koreans, probably due mainly to its geographic location between China and Japan, have always been wary of being squeezed out between two 800-lb gorillas. As such, the strategy has always been to "Dutch-fy" the country (I just made up the term so don't pay too much attention to it) - i.e. open up the country as much as possible and become the commercial/financial hub of the region, modeling after the Netherlands (another relatively small country neighboring the giants). This often looks like a lofty goal to me, especially considering how resistant the country can sometimes be to foreign culture/companies. Further, in this highly networked era, the "hub" doesn't have to be determined by the physical location - Tokyo to Beijing is a short flight that doesn't require a transfer at a "hub". 

That said, the Global Game Hub sounds like a good plan, something that could be a boon to Korean games industry. The plan is to build a cluster so that various players in the industry can get their heads together and churn out innovations. Nokia, with its Finnish R&D clusters, has effectively proven that a well-designed industry hub can take the game to the next level for everyone participating in such "clusters." 

Some of the potential themes to be explored at Global Game Hub: Mobile games that can support multiple platforms; Connected gaming experience across wired-wireless world; Kick-ass games for the rapidly expanding smartphone audience; etc. And interestingly enough, guess who is behind this - it's Microsoft. The Kyunggi provincial government apparently hopes to attract big FDI (foreign direct investment) from Microsoft, for whom gaming and multimedia is becoming bigger and bigger a business. 

Overall, the plans for Global Game Hub are still sketchy and lack details. But it sounds interesting enough, and I'll keep an eye on it and scoop more details once they are available. 

(PS. Postings have been slow, and could remain so for the next week or so, due to my business trip to Bay Area. I met with some folks I know around here over lunch etc, but if you are in the Bay Area and would like to meet up, please drop me a note at changkim at google dot com. GIven it's a regular business trip, my schedules are pretty hectic this time, but let me try at least.) 

The other day, Naver announced AdCast, a new display banner ad system that allows viewers to exert control over the banner ads they see on Naver's front page. 

User can stop/replay flash ads, find advertiser info, or navigate through multiple banner ads when more than one ads are rolling on the same ad spot. Further, user can also copy a banner ad (for whatever reasons, such as great background music, etc) onto one's blog. Says Naver: Good display ads can be deemed as good content - sometimes ads are so good that you'd probably want to keep them. 

A natural question that follows is, why is Naver doing this? One possibility is Naver may be trying to bring up the display ads price. It didn't happen yet, but we know ads business (especially the banner/display ads) has been hit pretty hard by the economy meltdown, and Naver wouldn't be entirely immune to it. So it may be possible that Naver's plan is to make the display ads system slightly better and leverage that to increase the display ads fees. 

Even if this is Naver's effort to squeeze out the last drop of their display ads revenue, I won't blame them - After all, a company should strive to maximize its profit. In fact, it could even be a good gesture if Naver wants to make its ads better before increasing the price (if it does so, anyway). But I am worried about the aftermath of Naver's ad fees increase, if such thing ever happens, as by now so many small medium companies and shop owners in Korea turn to Naver for advertising and the ad price increase will affect many of them, who are already struggling under the slow economy. These days, putting up an ad on Naver is a must, not an option, for many small medium companies and shop owners - such is the dominance of Naver in Korea.