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  • Archive for August, 2012

    Economics of Psy’s “Gangnam Style” – 5 Things to Know

    August 30th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    1: Who is Psy (real name: Park Jae-Sang): bad boy v. court jester?


    He is a Korean-version bad boy and court jester packaged into one person. Psy’s biggest hit before ‘Gangnam Style’ was ‘Champion,” which was a hit due to remarkable timing with Korea’s hosting of the 2002 FIFA World Cup, in which Korea was viewed as a soccer/football ‘champion’ in the form of a quarterfinal team.


    2. Is he an unusual K-Pop star?


    His is an unlikely figure for singing stardom due to his age (mid-30s) and looks (typifying the average person rather than a meticulously prefabricated singer beauty). No one could have expected “Gangnam Style” – originally geared for local audiences – to be a global sensation. Psy is the anti-beauty, anti-model, anti-authority singer – ironically, this could his the recipe for success. Psy’s unique combination of these qualities have been fairly constant for the past decade. But what has changed is what the world, inside and outside Korea want, in a youtube era – authenticity, reality, and buzzworthiness – all of which Psy fortunately had at the right time, and the right place (youtube, with about 60 million hits for the song, twitter and other social media).


    3. What is Gangnam Style?


    Gangnam style as the current pop hit song is a fun, lovable, and catchy song that features outlandish entertainment in the form of mesmerizing supertechno beats and rhythms combined with outrageous “horse dance” moves, with fast cars and attractive women as backdrops. At the less visible level, it is a “satire with synthesizers” placing all the perceived virtues of “Gangnam” (an affluent region of Seoul) under a critical light, essentially mocking the superficial, consumer-driven, style over substance Gangnam area culture.


    4. What does Gangnam represent socially and historically?


    “Gangnam” literally means “south of the Han River.” Today, the Gangnam area is viewed as an upper-class region, home to famous celebrities, top Korean firm headquarters, and pricey shopping and apartments. For these reasons, the Gangnam area typifies the consumerism of modern day Confucian Korea. The area is an $82 billion economic region, which is also home to the country’s most prestigious university (in which an estimated 41% of its student body are from Gangnam), the alma mater of a disproportionately large amount of Korea’s top power players in business and government. Gangbuk, north of the Han River, is the traditional area of Seoul, which is viewed as a less economically elite region. Gangnam, in short, is geographic symbol of current day conspicuous consumption in a time when Korea’s education, income, social status are increasingly bifurcated between the “haves” and “have nots.”


    5. How can Psy’s hit be monetized?


    South Korea’s government has been supporting Korean entertainment overseas as a form of “soft power” diplomacy – similar to the soft power of Hollywood – which has had some success, but mostly within Asia. Psy’s success has been a surprise. If you believe that a Korean hit pop song in the US market is not a “one hit wonder,” then buying shares in Korean entertainment companies (SM Entertainment, CJ Entertainment, JYP, YG Entertainment) may line up with your investment view.


    Interviews about this topic with Jasper Kim, Asia-Pacific Global Research Group, are below:
    ABC TV’s Nightline with Jim Middleton:

    ABC Radio:
    available here with ABC, the Australian Broadcasting Corp’s “Common Knowledge” program (interview begins from the 15:00 min mark):
    The actual “Gangnam Style” music video featuring PSY is below:



    Apple v. Samsung: Expert Opinions (Asia-Pacific Global – featured)

    August 29th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    Jasper Kim of Asia-Pacific Global Research Group has been featured in the BBC in its piece today in its “Expert Opinion” section relating to the Apple-Samsung patent verdict:


    Apple-Samsung patent verdict: Expert opinions


    Future wars?

    Jasper Kim, the founder of theSeoul-based Asia-Pacific Global Research Group, says South Koreans may perceive the ruling as unfair because the trial took place in the US – and such sentiment could trigger a patriotic backlash against Apple products.

    I believe the ruling is not the end of the Apple-Samsung lawsuit war; instead it may be the beginning.

    In the past, Apple was identified less as an American company, and more as a technology giant – but that may soon change.

    What Apple risks is an anti-Apple, anti-US double backlash effect in a country that has surprisingly been fond of Apple products. I say surprisingly because the rapid rise in popularity of iPhones and iPads happened in Samsung’s own backyard.

    An anti-Apple sentiment could undo all of that and negatively affect sales of the next edition iPhone here.

    Samsung may also request that certain Apple products be banned in South Korea in the future.

    At the same time, the South Korean firm can in theory appeal at least two more times against the US ruling; to the US appellate court and then to the US Supreme Court.

    So while the judgment has shifted the momentum of the legal tussle between the two rivals significantly towards Apple, the celebrations may need to to wait for a while.

    Apple has won the battle, but it has yet to win the legal war against Samsung.



    apple v. samsung

    Apple v. Samsung: $1.05b verdict, the beginning or the end?

    August 25th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    Apple has “won”…for now.


    Today, a federal US court ruled against Samsung, relating to patent infringement claims against certain Apple products (iPhones, iPads). Samsung has also raised claims against Apple.



    – The jury’s conclusion was: $0 to Samsung, $1.05 bn to Apple.


    – We believe the ruling is not the “end” of the Apple-Samsung lawsuit war–instead it may be the “beginning.” True, the two have spent millions (or its won equivalent) in dozens of lawsuits spanning 4 continents. But this US lawsuit was important because (1) it is on Apple’s “home” territory (California); and (2) Samsung is highly dependent on US consumers buying Samsung products.


    – South Koreans will view the ruling as an unfair “home court” ruling (i.e., that this is a US court with US jury members in San Jose, CA, Apple’s backyard). Such sentiment may trigger a patriotic backlash against Apple products. In the past, Apple was identified less as an American company, but his may soon change. This could negatively effect the next iPhone (5) handset sales in South Korea. What Apple risks is an anti-Apple, anti-US double backlash effect in a country that has surprisingly been fond of Apple products (surprisingly because the rapid use of Apple products, specifically iPhones and iPads, happened right in Samsung’s own backyard, as explained in my ‘iPhoning of Korea’ WSJ op-ed below). Samsung may also request that certain Apple products be banned in South Korea in the future.


    – Importantly, the US ruling, with or without treble damages (where damages can be tripled), is not a “knock out” blow for Apple (given Samsung’s cash reserves), but it is a serious momentum shift towards it for Apple.


    – The ruling could just be the “beginning”? Namely, although the US court is a district court–the lowest federal court level–the lawsuit can in theory appeal at least 2 more times: (1) to the US appellate court; and then; (2) the US Supreme Court.


    – In practice, the higher up on the federal court hierarchy, the lower the chance that the appeal will be heard. So the chance of a successful appeal is not guaranteed (unlike in South Korea, in which appeals are often automatically granted). Even if an appeal is granted by the US appellate court, only issues of “law” not “fact” will be heard by a 3-judge panel and/or jury. In plain English, this means that the higher court will only hear an appeal if it believes that a possible “error in law” was applied by the judge. Basically, the appeal process is an uphill battle.


    – The case was heard by Judge Lucy Koh, one of the few Asian-American judges nominated to serve at the federal court level. She is a Harvard Law School graduate (a bit before my time there).


    – The momentum has now shifted significantly towards Apple


    CONCLUSION: before anyone begins to celebrate, this is not the end–Apple has won the battle, but it has yet to win the legal war against Samsung.


    * Check out my earlier WSJ op-ed piece (below), which explains how Apple’s iPhones surprisingly became so popular in Samsung’s own backyard of South Korea.


    Disclaimer: the author does not own any Apple or Samsung shares



    The iPhoning of Korea – How Steve Jobs pried open a sheltered market and changed the way a country uses its mobile phones.


    Korean tech junkies are cheering this week’s move by the government to allow the import of the iPad, Apple’s new tablet device. Its introduction had been stalled by a government agency that claimed it needed to “certify” the tablet’s wireless networking feature. Popular pressure forced Seoul to reverse course. But while fans go aflutter over the possibilities of this new kind of computing, the transformation being wrought by the last Next Big Thing, the iPhone, is hardly finished either. It’s not simply that programmers and users continue experimenting with the iPhone’s technological capabilities. The iPhone also is shaking up …
    [The rest of the article can be found on for subscribers]


    Korea’s Missing Ingredient

    August 24th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    Below is my latest Wall Street Journal (WSJ) op-ed piece, “Korea’s Missing Ingredient”




    • This article asks the question: what challenges face Korean venture capital (VC) firms?


    • Korea’s economy is heavily dependent on large conglomerates. And exports make up nearly half (48%) of its GDP. Just think of how much more vibrant Korea’s economy could be if VCs were afforded greater economic freedom to invest in “the next big thing.”


    • Korea’s state-sponsored “hardware”–technoparks, incubators, business parks–are fine,but not optimal (those receiving such public funding may, as a result, have a financial self-interested incentive to disagree with this view).


    • The corporate laws should be reformed such that VCs can be formed as not only as corporates (albeit stock or LLC, the latter being a more flexible form of a corporation, but still by definition, a corporation by law), but as also as partnerships (as in Silicon Valley, Route 128)


    • Policy prescriptions include amending Korea’s commercial code to allow VCs to form as partnerships, so that greater interaction and a longer term focus can be formed between the VC investors and the invested businesses (and their founders).


    Korea’s Missing Ingredient

    Venture-capital funds have been the special sauce for high-tech booms elsewhere. Seoul should get out of the way of a similar boom.

    The U.S. has Mark Zuckerberg of Facebook. Japan has Masayoshi Son of Softbank. China has Jack Ma of Alibaba. South Korea has . . . who, exactly?

    That question grows more and more urgent as Korea tries to shift economic gears from manufacturing powerhouse to global innovator. The Zuckerbergs, Sons and Mas of the world show that fostering creativity requires creative geniuses. But those stories also highlight the need for creative financing—and especially venture capital.

    In its early years, Facebook received substantial funding from venture funds Accel Partners and Greylock Partners. Long-established firms such as Cisco, Federal Express, Intel and …


    [remaining article available at]



    South Korean President Visit To Disputed Dokdo Islets

    August 10th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    The South Korean president goes to Dokdo (a disputed island between S. Korea and Japan) – not a bad strategic move, as I mention in my quote in today’s recent VOA (Voice of America) article below. Implementing the patriot card of visiting Dokdo – a disputed islet between S. Korea and Japan – is a “no lose” strategy for the president who is only months away from the end of his term. This is the first Korean president to visit Dokdo. And we can be sure that it will be the beginning of renewed escalated tensions between the two countries. Meanwhile, the U.S. is caught in an awkward position of having to take sides among two very important allies in NE Asia.

    – Jasper Kim (8.10.2012)

    Voice of America article