Digital Media in Asia Blog

Today (5/30/06), Berkman’s Digital Media in Asia Project co-founder Eric Priest will give an informal lunchtime talk on Asia’s role in shaping the future global entertainment industries. Info is as follows:

Berkman Tuesday Luncheon Series, Tuesday, May 30 – 12:30 pm
Berkman Conference Room, Berkman Center
1587 Mass. Ave., Harvard Law School, Cambridge MA

Guest: Eric Priest
Topic: Asia at the Cutting Edge?

Some believe Asia is at the cutting edge of twenty-first century entertainment industry business models. A combination of high copyright piracy levels and high-tech populations has led entertainment companies in places like China, Hong Kong, Taiwan, and South Korea to embrace the internet and emerging digital and mobile technologies as they seek innovative new revenue sources. This includes a massive new market for citizen-created media (music and movies) on the internet in China. What are the trends and are they really leading to sustainable business models for the rest of the world to emulate? Is the conservative state-run media in China creating a strong market for alternative, citizen-created Internet media and what are the implications for Chinese society, politics, and the entertainment industries? With all the emphasis on technology, is creativity increasingly an afterthought?

Eric Priest is a research fellow in the Berkman Center’s project on Internet Filtering, and a cofounder of Berkman’s Digital Media in Asia Project. He is also a visiting researcher at Harvard Law School, and an adjunct professor of law at Chicago-Kent College of Law.

Bio: http://cyber.law.harvard.edu/home/eric_priest
Digital Media in Asia project blog: http://blogs.law.harvard.edu/dmablog/

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Currently, 75% of households in South Korea have high-speed broadband access. New types of businesses, not really found in other countries, have developed as a result of the growth of the broadband market in South Korea. 

There are companies in Korea that provide “video on demand” online, often even with high-definition video, for less than Americans pay to rent a DVD.  Companies that provide online gaming as well as services like the Cyworld blogging site have penetrated all segments of society and become a national obsession.

 

According to the Korea Times, South Korea still remains the world leader in high speed Internet penetration:

Korea became an Internet powerhouse in the late 1990s thanks to its fast investment in the asymmetric digital subscriber lines (ADSL), which pump data at an average speed of 2.5 megabits per second, about 50 times faster than conventional dial-up modems.  Korea crossed the 20-subscribers-per-100-residents threshold as early as in the third quarter of 2002 at 20.6 and has remained over the coveted mark during the following nine quarters.  Currently, approximately 12 million of the country’s 16 million households are hooked up to the high-speed Internet and more than half of them are subscribed to ADSL.

In accordance with the high internet penetration, South Korea is known to have one of the highest rates of online piracy with respect to digital media such as movies, music, and digital books.  Clearly the actions taken by the Korean government have not been very useful as online piracy is continually growing. How will South Korea be able to control online piracy in the future?

The South Korean government has announced plans to pour US$90 million into the failing Korean music industry, which it claims is slumping due to the “rapid growth of digital music market and emergence of diverse high-tech music-listening devices.”

As part of the initiative, the government will expand its definition of the “music industry” to include not only record labels and live musical performances, but also “virtually every area regarding music, such as music education, production of musical instruments, performances by underground music bands, music management, online and offline circulation of music and ‘noraebang,’ rooms hired for karaoke singing.”

According to a study by market researcher TNS, almost 20% of mobile phone users polled in a 15-country study now listen to music on their cell phones, compared with 15% listening on home stereos and 10% on dedicated digital music players like an iPod. The US trailed others in adopting music phone technology, with a mere 4% listening to music on their phones. More daunting for proponents of music phones in the US is that a separate study suggested only 10% of US mobile users are highly likely to purchase a music phone. In Hong Kong, 23% of mobile users listen to music on their phones, while 19% do so in the UK.

South Korea was #1 in the study with 26% listening to music on cell phones and a whopping 60% choosing mobile music as one of the five applications they would like to start using, or use more of in the future. “This puts mobile music in top place as the application with highest potential. This figure is highest amongst mobile users in South Korea (60 percent) and Sweden (46 percent). Once again, the U.S. ranked last in the study, with only 19 percent of respondents stating that they want to start listening to music on their cell phones.”

The difference might be due partly to a bit more of a Luddite culture in the US (Rebecca MacKinnon has recently blogged about how the cell phones in China are higher tech and more multimedia focused than those in the US), and the fact that digital music phones have (amazingly) only been available in the US for a few months. But I think this might also suggest a difference in US and Asian consumption habits. One thing that has made iPods popular in the US is that people can use them to manage and transport their entire music collection; they can be mixed and matched with all kinds of equipment–home stereo and car stereo–in ways that it seems cell phones are unlikely to be able to, at least for some time. The US’s car culture, if nothing else, is reason to imagine that iPods will continue to dominate the digital music scene here, while that obviously would be much less of a factor in Asia, where most people do not commute by car.