After Apple Computer unveiled its first cellular phone on Tuesday, Korean phone makers say they will not be immediately impacted by its release, but analysts say that changes will take place in the long run.
At the Macworld Expo in San Francisco earlier this week, timed to coincide with the Consumer Electronics Show in Las Vegas, Apple’s chief executive Steve Jobs introduced an advanced prototype of what Apple’s phone will look like when it hits U.S. stores as early as June. Macworld is an annual showcase for Apple’s technology and new products.
Apple’s phone, called the iPhone ― similar to its music player iPod ― is different from existing phones in that it has no keypad, but uses a touch-sensitive screen. Otherwise, its functions are mainly the same as that of conventional cellular phones ―the multimedia device can also play music, browse the Web, and take pictures. Priced at $499 or $599 depending on the size of its memory, the iPhone will be available only through the mobile service provider Cingular Wireless. Cingular is based on GSM technology, compared to other mobile service providers such as Verizon, which offer phones that operate on code division multiple access (CDMA) technology.
The three local cell phone makers-Samsung, LG Electronics, and Pantech-said they didn’t think the iPhone would affect their business for now.
Yang Yuin, a spokeswoman for the Pantech Group, which sells SKY brand cell phones through its affiliates Pantech and Curitel, said that Apple’s release of the iPhone reflects increasing demand for music phones and smart phones.
“Music phones are becoming more popular because the service providers, which are also the content providers, are making it easier for users to download content,” she said. “We don’t have plans to change our marketing strategies, but the iPhone release comes in line with the music phones we plan to release in the United States later this year,” Ms. Yang said. She added, however, that the company’s plans for music phones were made at several years ago, and are not a response to Apple’s iPhone.
“The price is very expensive so the iPhone may take up the upper end of the market. In comparison, LG’s Chocolate phones are about $300 so we are not in direct competition,” said a spokesman for LG Electronics.
Song Pyeong-gwan, a spokesman for Samsung Electronics, said that the iPhone will have its main effect in the United States. “Apple has its brand name and the media is very favorable there,” he said.
Industry specialists agreed that the iPhone will not take over the world’s cell phone market like the iPod has in the MP3 player market, but said that it may sweep through the existing personal digital assistant (PDA) market and compete with Samsung and LG’s high-end phones.
Kang Hee-young, an analyst at Goodmorning Shinhan Securities, said that existing phone companies will be threatened because the mid-to high-end phone market doesn’t have any special killer applications. “Samsung recently released its Google and Yahoo! Phones, which will have to compete with the iPhone, and for LG Electronics, its business is the United States is big, so it will naturally be affected,” she said.
Kim Byeong-ki, an analyst at Kium Securities, however, disagreed. “Even if Apple achieves its plans to sell 10 million units by 2008, it will be less than 0.1 percent of global market share,” he said. He added that if anyone should feel threatened, it should be Motorola and Nokia, which hold the top market share in the United States for GSM-type phones, but said that that Samsung and LG, which dominate the CDMA phone market in Korea, will be less affected. by Wohn Dong-hee for JoongAng Daily