The world software market is valued at $1.3 trillion. The Korean government, to position itself at the head of the IT industry, has launched the 'Actualizing Creative Economy' to support measures for preeminence in software innovation. Since 2012 the government has invested a sizable portion of its budget into this effort.
Software innovation strategy is meant to develop export software abroad. It is about developing domestic software by an innovation strategy and dominating the overseas market. However, established companies such as Microsoft, IBM, Oracle, SAP, among others, are continually gaining and maintaining commercial supremacy, beckoning critics to ask to what extent a Korean brand can make an impact into this fiercely competitive market.
Last year, the Ministry of Science, ICT and Future Planning claimed that the amount of software exported was $3.4 billion, an increase of 54.3% over the previous year. This indicates that Korean software export controlled by the government is having a successful impression.The so called E-Gov is an exemplary case for other countries, often educating interested locals about its merits.
The hurried growth of the IT software industry in Korea, according to profit data by major domestic companies, is not necessarily benefitting. Eighty percent of Korean sales entered the overseas markets. Yet the exported core technology is owned by established, overseas, non-Korean companies.
For example, in the case of E-Gov, there are no known domestic items for building server products, operating systems, network devices, or programming languages. Any country interested in following the Korean E-Gov development model would request a few packages to integrate into their system. Other systems such as core technologies are owned by companies such as Microsoft and Oracle, which E-Gov uses, substantially limiting the government’s profit effort. This is a major reason why a push is being made to produce domestic core technology.
The Ministry of Science, ICT and Future Planning empathizes that this strategy is a comprehensive policy that encompasses the software industry including its manpower, market, and the industrial ecosystem. The industry has already cited manpower weaknesses in order for the ministry to institute policy training. The ministry has announced a plan for a software Meister High School to provide an academic software concentration alongside a scholarship, mitigating personnel sector weaknesses.
Also, the Korean Federation of Information and Technology Societies and the Ministry of Science, ICT and Future Planning review measures to enhance an environment where the students receive software education earlier in Korea, reflecting software into the regular course load, and another measure that selects software as an elective for university admission, as part of an active discussion about adding software into the school curriculum presently discussed in the United States and the United Kingdom. Other policies include promoting collaboration between major companies and IT small companies and expanding investment of R&D for vitalizing markets.
Taking the interim evaluation of software innovation strategy from the Ministry of Science, ICT and Future Planning, the opinions from experts are generally negative. Some experts wonder if this attempt is about strengthening Korean software or whether it is about relations of gain and loss among the various related parties. It is unclear whether the intention is to help software be sold to satisfy petty expenses or fix core problems.
Chairman Cho Sung-gap at Korean Federation of Information and Technology Societies presents a view considering the future in order to promote the software industry. 'We have to make one such that there is no alternative.' Cho also mentions that one has to try hard to find a method about how to benefit from developing domestic software.
There is nothing that one worries more about than entering into a saturated market. The domestic market would be all too occupied by domestic brands some years later at least if the fifty million people of Korea uses it. There must be one day when domestic software will be compatible with overseas brands if the government helps private companies and encourages communication among them. It is vital to improve a policy rather than to find a short-term outcome if the government intends to let 'software innovation strategy' lose direction become a policy for revival of this country.
By Kim Yu-na
