South Korea welcomes the iPhone

South Koreans will soon join the millions of others worldwide as its government on Wednesday approved the sale of the iPhone there.

(Credit: Apple)

For years, the Korea Communications Commission used technical rules to stifle competition, allowing homegrown companies like Samsung and LG to take over the market, according to a Wall Street Journal report.

With an estimated 93 percent of South Korea's population subscribing to a mobile service, Apple should be able to overcome one of the biggest barriers to smartphone success in South Korea--applications. Apple has been able to entice developers worldwide to build apps for the iPhone, with 75,000 apps available and 1.8 billion apps downloaded thus far.

There was no indication of a release date, price, or carrier for the iPhone yet in South Korea.

This is the second piece of news related to international iPhone sales in less than a month. Apple landed a deal with China Unicom in late August to begin selling the iPhone in that country. Apple is also in talks with China Mobile, that country's largest wireless carrier with 141 million subscribers.

[bakedpatato]

hmm, that means that there is a CDMA version of the iPhone now, as Korea only uses (W)CDMA

[frozenjello]

For 3G connectivity, every iPhone 3G and 3GS use UMTS, which uses W-CDMA as the air interface. I think this is the same reason why the iPhone works in Japan. This is also different that the CDMA used by Sprint and Verizon.

[Mark_Anderson]

That's nice. It's still going to flop like a wet fish over there.

[frozenjello]

Instead of giving a flippant response, please explain why you think it will not succeed. Otherwise, you sound like Microsoft CEO Steve Ballmer in April 2007:

"There's no chance that the iPhone is going to get any significant market share. No chance."
http://arstechnica.com/microsoft/news/2007/04/ballmer-says-iphone-has-no-chance-to-gain-significant-market-share.ars

[Agrainofsalt]

As fronzenjello said, please explain why. I live over here and think it will do very well, depending on pricing of course. The iPod is the best selling PMP here, so I can't think why the iPhone won't be a success. Most of the new phones here are just lacklustre copies of the iPhone. I think it will succeed and succeed well as the industry is ripe for a shake up. There is no service here that comes close to the App Store and very few, if any, phones have Wifi. If Apple plays their cards right and negotiate a decent pricing arrangement they will become a major player here in the smart phone market.

[Mark_Anderson]

Mainly because it hasn't done particularly well in any market outside the US and possibly the UK where even there it's still beaten in terms of sales volume by competing handsets.

Look at the sales numbers, subtract US sales then compare those to the sales of, say, the Nokia 5800 or Samsung Jet. It's failed to dominate any market ouside it's native one where, let's be honest, the choice of handsets is rubbish.

The iPhone typically goes on sale, has a spike in demand and then drops off rapidly. This will be no different.

[JCPayne]

Asian phones are more advanced than those in the US market as well. Time and time again you'll see reports showing phone sold in Asia that are "Not available in the US market".

[richard993]

@frozenjello Thanks for the link. Microsoft do a lot of market analysis (Steve Ballmer doesn't just make up these figures), so when it comes to market share, they usually know what they are talking about. When you read Steve Ballmer's comment carefully, he says that out of 1.3 billion phones out there, Apple will only have a 2 - 3% penetration. That means that Apple will most likely sell between 26 to 39 million iPhones. I've done a search and according to a blog http://gregorykaiser.wordpress.com/2009/04/23/how-many-iphones-and-itouch-ipods-sold/, Apple has only sold 21 million iPhones or 37 million if you include the ipod touch. So I guess Microsoft was pretty accurate, it has hardly put a dent into the global mobile phone market.

[frozenjello]

@richar993, First let's establish how much of the smartphone marketshare Microsoft and Apple have. The graph in the following link says Apple's share in the second quarter of 2009 grew to 13.3%.
http://www.businessinsider.com/chart-of-the-day-iphone-market-share-up-blackberry-down-2009-8

That graph doesn't show Microsoft's share, but if you follow a link on the businessinsider.com page to where they got their data, http://www.gartner.com/it/page.jsp?id=1126812
you can read that "Microsoft's share continued to drop year-on-year to account for 9 per cent of the (smartphone operating system) market in the second quarter of 2009"

Now let's also establish that neither Apple nor Microsoft have their operating system on phones in any other segment of the mobile phone market (dumb phones and cheap phones made for the prepaid market). That means smartphones are the entirety of the products they sell.

Microsoft has (9% * 40,962,800 smartphones / 286,122,700 total mobile phones sold in 2nd quarter 2009) = 1.3% of the worldwide phone market share. Shockingly low right? Apple's 13.3% smartphone share means Apple has 1.9% worldwide mobile phone share, which is very close to Steve Ballmer's prediction.

However, Steve Ballmer's quote was "if you actually take a look at the 1.3 billion phones that get sold (annually), I'd prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get". In what universe is he living in where he thinks Microsoft is on over 60% of the mobile phones? I think he was clumsily suggesting that Microsoft's licensing of Windows Mobile was the only way to conquer the market. With only 1.3% marketshare after 10 years of trying, Microsoft has failed miserably.

[richard993]

@frozenjello
It's funny that you mention that, although he hasn't really said anything inaccurate, Steve Ballmer has carefully crafted his words to make the suggestion that Microsoft will have or is aiming to have 60-70% market share... but you are absolutely right, frojenjello, that based on the current projections, Apple will most likely get there way before Microsoft. A very entertaining comment that he has made, but with a very sad (or happy depending on who you are) truth that they are loosing the game.

[frozenjello]

No question that iPhone doesn't have the top numbers for units sold in any market. It doesn't have to, because for every iPhone sold, it will be at a huge profit. Although Nokia has 3 times Apple's worldwide smartphone marketshare (and also sells untold millions of dumb phones), Nokia and Apple will each generate almost the same operating profit this year.
http://www.businessinsider.com/chart-of-the-day-apple-rim-swallow-mobile-industry-profits-2009-6

I have another way of looking at the bar charts from the above link: Apple is literally taking Nokia's operating profit in the worldwide mobile phone industry. To see what I mean, visually add up Apple's and Nokia's share of the bar charts in 2009. Notice that this sum is almost equal to Nokia's entire 2007 share!

Also, let's switch your game around. I can say that the Nokia 5800 and Samsung Jet phones you mention are complete flops here in America. They are only available for purchase online for around $300 and $400, respectively. Since they are not available at the local AT&T or T-Mobile stores, these phones are have absolutely no mindshare outside of the tech enthusiast community.

The Nokia 5800 probably can't be sold in South Korea's restrictive market. As for the Samsung Jet, CNET's reviewer said it best: "The Samsung Jet is a powerful multimedia phone ... But don't mistake it for a smartphone."

[Mark_Anderson]

That's true but it only serves to show how horribly fragile their business model is. Once the iPhone is overtaken - which it will be like the RAZR and the N95 - where do they go? Nokia make less money per unit but are far more robust because of the diversity of their product range.

I also specifically mention outwith the US because Nokia has no meaningful presence their. Fortunately for them the US is only the third biggest market in the world and they dominate the other two.

Bottom line is that the iPhone is a huge success in the US and a moderate success elsewhere.

[frozenjello]

@Mark_Anderson. Probably the thing that is holding back the iPhone from becoming a dominating success in every country is the extra cost of the mandatory data plan, which many people balk at. Is Apple catering to too niche of a market? Perhaps. But you think Apple has a fragile business model? Quite the contrary: it is the traditional mobile phone companies who have been traumatically shaken by Apple's business model. It is not just hardware, but software as well. All the competitors are scrambling to set up their own App Stores. iPhone is not just a phone which will simply be overtaken by a competitor's model in a few years, it is a PLATFORM around which a thriving ecosystem of developers and users has already formed. Competitors are nowhere near that point yet, not even "outwith" the US. (You're in Scotland, right? "Outwith" is not an American term and I had to google it to find out it is a Scottish colloquialism meaning "outside of").

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