NY times, June 2, 2015
What Silicon Valley Can Learn From Seoul
South Korean companies are building software for smartphones
that’s chaotic, multifunctional and exciting — everything that American apps aren’t.
Like most young people in the Bay Area, Mike Kim grew up believing that the future of technology was being forged
in Silicon Valley. Raised in Piedmont, an affluent suburb of Oakland, Kim was in college during the rise of Facebook,
and he watched in amazement as tech start-ups transformed the world around him. After graduating in 2006, he
found work in the industry, at Zynga, Monster.com and LinkedIn.
Then, five months ago, he accepted an offer to work for Woowa Brothers, a South Korean company that runs a food
-delivery start-up called Baedal Minjok. The job was great — but living in Seoul was nothing less than a revelation.
“When I was in S.F., we called it the mobile capital of the world,” he said. “But I was blown away because Korea is
three or four years ahead.” Back home, Kim said, people celebrate when a public park gets Wi-Fi. But in Seoul, even
subway straphangers can stream movies on their phones, deep beneath the ground. “When I go back to the U.S., it
feels like the Dark Ages,” he said. “It’s just not there yet.”
While Silicon Valley is the largest and most enduring locus of tech innovation, a number of cities around the planet
are nipping at its heels: Tel Aviv, Berlin, Bangalore. But Seoul, the capital of South Korea, is in a sense the Valley’s
closest rival. American investors are beginning to catch on, and venture capital is starting to flow west, across the
Pacific. An early-stage American venture firm called 500 Startups recently spun off a small fund called 500 Kimchi,
which focuses exclusively on South Korea. Last fall, Goldman Sachs led a round of investment in Woowa Brothers
and its delivery service. In May, Google opened a campus in Seoul, its first in Asia. The office is in the trendy district
of Gangnam — yes, that Gangnam — which is already home to a growing cluster of mobile start-ups and a handful
of technology incubators to mentor them.
Tim Chae, who runs 500 Kimchi, said that American investors have begun to think of Seoul as a sort of crystal ball.
In it, they can glimpse a future where the most ambitious dreams of Silicon Valley — a cashless, carless, everything-on
-demand society — have already been realized. Nearly all of Seoul’s residents use smartphones, and many of the
services just now gaining in popularity in the United States have been commonplace in South Korea for years.
Much of this was made possible by two decades of enormous public investment. Seoul is blanketed with free Wi-Fi
that offers the world’s fastest Internet speeds — twice as fast as the average American’s. Back in 1995, the
government began a 10-year plan to build out the country’s broadband infrastructure and, through a series of public
programs, to teach Koreans what they could do with it. South Korea also eased regulations on service providers to
ensure that consumers would have a multitude of choices — in marked contrast to America, where a handful of
cable and telecommunications monopolies dominate the market. Such healthy competition in Korea keeps the cost
of access low.
To maintain South Korea’s lead, the country’s Science Ministry recently announced a $1.5 billion initiative to upgrade
Korea’s mobile infrastructure. By 2020, the government predicts, it will be 1,000 times faster — so fast you could
download a feature-length movie in approximately one second. In the same time frame, the Federal Communications
Commission hopes to wire most American homes with broadband Internet with speeds of at least 100 megabits per
second, or roughly one-sixtieth of South Korea’s goal.
South Korea may be futuristic in some regards, but from a design perspective, many of the country’s most popular
web services look outmoded, like throwbacks to the ’90s. Most mobile apps and web pages are crammed with
chaotic boxes of information, stacked headlines and flashing lines of text.
This is certainly true of KakaoTalk, a messaging app that is installed on 93 percent of Korea’s smartphones. Kakao
Talk was developed in 2010 by Beom-su Kim, an early web pioneer in Korea who built a popular online gaming
portal called Hangame. A failed effort to take Hangame to the United States happened to coincide with the release
of the first iPhone. Beom-su Kim bought several and began developing apps for them, a full two years before the
device would arrive in South Korea. KakaoTalk was one of his first creations.
The app was quickly adopted by Korean users as a free alternative to text messaging. Part of its success is due to
the fact that KakaoTalk functions like its own version of the Internet within a smartphone: Users don’t have to close
the app, ever, to check the news, talk to friends, order dinner or play games. To an American, the app’s design is
insane, like stepping into a demented fun house. Pages are drenched in neon and populated with googly-eyed
By contrast, American mobile design is fetishistically minimalist. Silicon Valley applauds itself for good taste in this
regard, but this aesthetic has sprung up partly in response to a deficiency: Americans have learned to strip out
bandwidth-guzzling elements because they slow down loading times. Korean designers, lacking such bandwidth
restraints, can stuff their apps full of all the information and widgets they like. On-screen real estate isn’t an issue,
either, because Koreans prefer massive phones. While the “phablet” — the missing link between a phone and a tablet — is popular as a punch line in the United States, it’s been in high demand in South Korea for years.
This trans-Pacific gap in bandwidth is so pronounced that Korean developers often have to strip down their software
if they want to take it stateside. Nicole Kim, chief executive of a file-sharing service called Sunshine, which recently
opened an office in San Francisco, said the service had to be adapted to inferior American broadband. “We made
Sunshine simpler because the speeds are quite lower than the Korean and Hong Kong networks,” she said. She says
her engineers recoded the app to allow for the sharing of smaller items, like design files and business documents. In
Asia, people use Sunshine for more bandwidth-intensive files, like music and videos.
Even when Korean firms don’t encounter technological issues, the design gulch can confound their attempts to lure
American customers. In 2014, Doyon Kim was tasked with taking Band, a South Korean mobile-messaging app, to
Silicon Valley. Band lets friends chat, plan outings, share video files, split bills and even conduct informal polls about
where to go to dinner. Doyon Kim says that the sheer number of Band’s functions confused users who were not
accustomed to performing all of those tasks within a single app.
“As a newcomer in the United States, products have to have one strong feature to market,” he said. “Band had so
many features and functionalities, that when people saw the product, they didn’t really get it.” The app got lost in the
mix of services like GroupMe, Venmo, Tilt and Dropbox — well-established stand-alone products that let people
perform the individual functions that Band offered. Despite attracting 30 million users in South Korea, in the United
States, “It barely made a blip.”
Silicon Valley’s single-use obsession found its most absurd expression last summer in the infamous rise of an
app called Yo. Yo allows users to send messages saying one thing only — “Yo.” — and thanks to its charming
idiocy, it became an overnight sensation. It quickly raised $1.5 million and was valued at as much as 10 times that,
despite having, to put it mildly, extremely limited utility. Still, it spawned a series of other hypersimple applications,
including “Lo,” which lets you share your location, and “1minLate,” which automatically alerts your friends when
you’re running late. The success of Yo revealed a lot about Silicon Valley ideology: For all the changing-the-world
talk, novelty frequently outweighs functionality.
Among the wave of single-use apps is a category that has come to be called “Ubers for X” — firms that, as Uber
does with cars, promise the delivery of a service in physical space at the tap of a button. A site called Product Hunt
lists dozens of them, and, as a group, they’re enlightening. There’s Shortcut (Uber for haircuts), Minibar (Uber for
alcohol), Doughbies On-Demand (Uber for fresh chocolate-chip cookies), JetMe (Uber for private jets), Eaze (Uber for
marijuana) and many more. None of these has radically altered the way Americans live, perhaps because the ideal
customer of all these services — wealthy, likes snacks, smokes pot — probably already works in Silicon Valley.
In Korea, apps that depend on widespread demand for convenience stand a much better chance. Eric Kim, a founder
of Goodwater Capital, a global venture firm that invests heavily in South Korea, said that the country’s high
population density and relative homogeneity makes it ideal for testing out new mobile services. There are about 50
million people in South Korea, and one in five of them lives in Seoul. Services that would be logistically difficult to
deploy in much of the United States scale easily in the capital.
Eric Kim offered the example of Coupang, a rising e-commerce company that offers same-day delivery, and
sometimes same-hour delivery, for things like groceries and diapers. (He is on the company’s board.) It helps that
delivery culture is so deeply established in Seoul, where people are accustomed to having couriers meet them at the
subway station near their homes to deliver their dry cleaning and, occasionally, their dinner. Meanwhile, most
Americans are still adjusting to using Amazon for more than books and gifts.
South Korea’s biggest start-ups are still dwarfed by the behemoths of California. But the Valley is keen to learn from
their businesses, many of which turn healthy profits — something that many celebrated start-ups don’t do.
One thing Silicon Valley hopes to learn is how to get Americans to actually pay for things on their phones. For years
now, Koreans have carried out important daily transactions, like paying bills and shopping, on their smartphones.
They’re also more inclined to pay for virtual accouterments that liven up digital interactions: for example, virtual
stickers that, for $1 to $2 per pack, can be pasted into online and mobile chats. Line and KakaoTalk are among the
largest mobile chatting apps in South Korea, with revenues in the hundreds of millions of dollars, and only a portion
of their income is derived from advertising. The rest comes from selling those digital stickers, as well as music and
Silicon Valley might also learn how to cater to more customers in more countries around the world. Most Korean
companies have been internationally minded since their inception, aware of their own limitations: South Korea is
such a small market that entrepreneurs are forced to consider how they might adapt to business abroad.
But without a more affordable, better mobile web, even the best new offerings from American entrepreneurs will be
stuck in the past. Perhaps one of the biggest lessons Silicon Valley’s innovators should learn from South Korea is that
to radically change how everyday people live their lives, they’ll need to convince their nation to invest in infrastructure,
so that we can actually use the services they want to sell us.
By JENNA WORTHAM JUNE 2, 2015