(News Focus) Upcoming release of iPad sends ripples across S. Korean tech sector

By Lee Youkyung
SEOUL, Jan. 31 (Yonhap) -- Apple Inc.'s unveiling of the iPad last week -- the
most anticipated Apple product since the 2007 launch of the iPhone -- drew mixed
responses from experts across the South Korean technology sector, home to tech
powerhouses such as Samsung Electronics Co.
While reactions ranged from skepticism to outright excitement over the new tablet
computer, consensus gradually emerged: The imminent launch of the iPad has placed
the industry spotlight on hybrid products.
"PCs are becoming more mobile, and mobile (devices) are becoming more like PCs.
What Apple is creating at the moment is converging in between the two," Kim
Han-joon, an analyst at Goldman Sachs in Seoul, said by phone.
Smartphones -- mobile handset devices with personal computer functions -- are
recent examples of such hybrid products. The smartphone market is the only
growing segment in the global handset market, which contracted about 10 percent
in the last year from a year ago.
Now the technology industry has coined another term for such portable multimedia
devices that connect to wireless Internet -- mobile Internet devices, or MIDs.
The development of MIDs as the latest trend in the technology sector, as shown by
Apple's new product, has stirred concern in South Korea. The country houses two
leaders in the global mobile handset market, Samsung Electronics and LG
Electronics Inc., but has no clear leader in smartphones.
Samsung Electronics, which announced its quarterly earnings results after Apple
CEO Steve Jobs unveiled the iPad in San Francisco on Wednesday, played down this
emerging category of mobile Internet devices.
"We see them more as entertainment devices rather than communication devices,"
Robert Yi, head of Samsung's investor relations team, told reporters and
investors on Friday.
"There will be some transitions in the PC industry to a certain extent. But in
terms of total convergence between mobile phones and these devices, I think there
is still some room to go," Yi added.
Apple's iPad is referred to as a tablet PC and uses a touch screen to navigate
the Internet instead of a keyboard and mouse. Its light weight, wide screen and
responsive touch functions cater to consumers who want a portable device, but
also want a monitor bigger than those of mobile handsets for viewing newspapers
or videos.
The hybridity of the iPad -- which uses an operating system from Apple's
smartphone iPhone, proliferates publications using sources like Amazon.com Inc.'s
Kindle, and enables most personal computer-like functions such as Web browsing
and games -- means its impact will be felt across the technology industry.
Iriver Ltd., a Seoul-based mid-size manufacturer of electronic books and portable
music players, already feels the repercussions from Apple's new product, though
iPad is still two months away from its public release.
"Apple's announcement has made the e-book a new hot topic in South Korea, so it
is very positive that they are bringing attention to the e-book market," said JK
Jeong, spokeswoman for Iriver, which is set to sell its e-book in U.S. market
this month.
Telecommunications companies and mobile carriers are excited about the imminent
emergence of another handheld device that could expand their retail channel for
wireless Internet networks.
"The iPad will help give a chance to people to enjoy wireless Internet, along
with the iPhone," said an official at KT Corp., the sole contractor of iPhone in
the domestic market and the second-largest mobile carrier. "It will be a catalyst
that causes an explosion in the country's wireless Internet market."
Analysts echoed the view that iPad could lift wireless data usage for South
Korean mobile carriers and expand their revenue amid a slowdown in the local
telecom market's growth.
"The introduction of another mobile Internet device will increase data usage,"
said Denny Kim at Eugene Investment & Securities. "For telecom companies, that's
good because they will create profits."
Meanwhile, it remains to be seen whether further entry of hybrid products into
the market could become a potential threat to laptop makers and mobile handset
makers.
"Whether it will diminish the sales of smartphones or handsets, that is difficult
to answer. It may have more impact on Netbooks or laptops," Kim said.
An executive from Samsung Electronics said mobile Internet devices still fall
short of replacing existing electronic gadgets such as mobile phones.
"There could be a lot of data-sharing, but in terms of the voice, I think we need
to see more as to how (it will be) able to evolve," Samsung's Yi added in the
conference call.
Sales of the iPad may not be as much of an immediate goal as stirring changes in
the broader trend in technology, others said.
"They don't seem to be as concerned about selling the devices," said Park Hyun,
an analyst at Prudential Investment & Securities. "In the long-term, they are
opening up opportunities for tablet PCs to step forward."
That means this is a trend that needs diligent tracking.
"It is one of the convergence devices to keep monitoring," said Goldman's Kim.
ylee@yna.co.kr
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