“Little things” matter in the telecommunications business. The difference between profitability and “just getting by” often depends on small focus innovations that increase margin, open new business opportunities, and add to the top line revenue. Attention to the “small things” are easily seen with the big three Korean LTE Operators. Their success has less to do with the “big vendor” solutions and more with the small innovations and focus on the little things that make big differences in the customer experience.
Working with Korean operators over the last year uncovers an interesting observation. The Korean operators translate their very specific in their goals and objectives into innovation and execution. They see a challenge in the market (scaling, revenue issues, growth, customer experience, etc). They seek out and test (in the lab) a range of solutions. Then if the cannot find a solution on the market that is meets their exact requirements, they innovate and build their own solution.
In essence, the Korean operators will not compromise on quality, function, and requirements. If you talk to KT, LG, or SKT and they mention how they are developing something with a local partner, it means that they have reviewed all the commercially available options and found them lacking. For example, the in-build solution developed by one of the Korean operators meet every requirement that an operator desired. Compare this to the “big vendor” solution. The equivalent solution we missing major “mandatory” requirements that most operator with any clue would ask. The “big vendor” was clueless when asked about these missing elements, saying they were “not needed.” What we have emerging from the Korean market is a telecommunications solution Eco-system that is driven by the necessity profitable margins.
All operators and vendors should be keeping an eye on these new Korean telecommunications companies. Their first products are directly tied to deployable solutions that driven by one of the big Korean operators. It is normal to find something developed in on operator appear in the other two within a short time (the attribute of “buy Korean” is a consistent theme).
The result is a vibrant telecommunications Eco-system that is driven by operator requirements. This Eco-system is currently sheltered. Many of the companies that are “instigated” by the operator requirements have a hard time bring their products to a wider market. Yet, when you encounter them, they all present rock solid products that have already been through the Korean operator gauntlet.
Recommendation?
For the Operator: Just like “visit Silicon Valley” is on the list of any tech savvy company, “visit Seoul” should be added to the list. Do some homework before visiting. Build dialog and relationships with the big Korean operators. They will and do recommend solutions that they have developed — showing off how they are able to thrive in the competitive and critical Korean broadband market.
For the Investor: These “partner” companies who are part of Korea’s telecom’s ecosystem are looking for ways to expand their market. Their products are proven in with the Korean provider — giving them a “operator clue” foundation. What they need is help to expand globally.
Extra Hint: If you want to see what the Korean operator have been focusing their innovation efforts, look at the materials from Netmanias (http://www.netmanias.com/). This is a consultant organization used by all the operators and several big vendors. They have excellent technology whitepapers. Their work is six months behind the innovation with the Korean operators. In other words, if you see a whitepaper on “video systems” from Netmanias, it means that the Korean operators are either upgrading their video infrastructure, buying new video solutions, or innovating with new “local” video technology partners.