[Viewpoint] No software, no futureThe biggest buzz words in the tech industry are definitely Apple Inc.. The company has enthralled consumers as well as investors. Its stock price has nearly doubled in just a year, topping Microsoft in the value of its market capitalization. Apple has become the irrefutable new alpha dog of the technology industry valued at over $200 billion, more than double what Samsung Electronics is worth.
Apple has hit home runs three times in a row with the successes of the iPod, iPhone and iPad. In the accounting books, Samsung Electronics is ahead with double the revenue of Apple and better profits. Yet the Korean tech company’s stock remains undervalued.
Samsung Electronics maintains dominance in mobile phones and electronics hardware. It is the industry’s most valuable player in semiconductors and liquid crystal displays. Its product designs are top notch. The company’s new do-it-all handset Galaxy S with Android 2.1 software has become a formidable competitor in the smartphone shoot-out.
But the stock market remains unimpressed because it doesn’t have faith in the company’s longer-term value due to its lack of a software edge. Investors are wary of how long Samsung Electronics can stay ahead in the fast-evolving tech industry without core software inventiveness. The staggering ascension of Apple is largely due to innovative software.
Samsung Electronics cannot help but envy Apple and Google for their respective mobile operating platforms iOS and Android. It belatedly jumped onto the bandwagon by acquiring local operating system developer TmaxSoft. But tech pundits shook their heads. The software manpower in Korea is largely devoted to developing game and portal applications. There are few resources left to work on mobile open systems, insiders say.
Fortunately, Samsung was able to run Android on Galaxy S phones for free. But no one knows when Google will start charging for its mobile operating system. The company also may demand exclusive use of Android on all Samsung phones. Being on the receiving end is always a place of insecurity and vulnerability.
Smartphones are only the beginning of smart technologies. People are already talking about smart TVs and smart cars. Software will be the survival tool in the tech ecosystem from now on. Without its own software, no company will be able to remain competitive. Samsung and LG will one day wake up and find themselves serving as factory lines for foreign brands.
We are not the only ones short of software manpower. Qualified and well-trained software manpower is hard to find everywhere except for the United States because most have been scouted by American multinational companies and lured by fat salaries and benefit plans.
We have brought this zugzwang upon ourselves. Until 2000, computer engineering departments of top technology universities like Seoul National University and Kaist were the most popular among top-tier high school graduates. In fact, these departments generated more than 300 high growth potential engineers.
But now, computer engineering majors largely find jobs in small companies. Large companies prefer graduates with overseas degrees and software technology has long been snubbed. Software flagships NHN and NCsoft have stayed afloat in this widely neglected field.
Seoul National University’s computer engineering department has been unable to fill its classrooms for six years in a row and graduates from the three top technology universities with degrees in computer science number less than 100 a year.
Software is a field that thrives on distinct and intense talents, observes Kim Hyung-joo, professor of Seoul National University School of Computer Science and Engineering.
“In the operating system field, we don’t need that many,” he said. “Just 30 to 50 key members can make the difference. They must be equipped with high intelligence, educational background and ample experience.”
About 10 prodigies earn for 100,000 staff members in software companies like Apple, Microsoft and Oracle. Among the staff, many are from South Korea. They opted to go abroad on advice from their seniors who told them working at local companies was a poor prospect.
The Korean software ecosystem has long been in danger. Under the current system, it can’t last for more than six or seven years. We have no resources to challenge the infinite new world of smart technologies. We should take interest in the newest success stories. A few that hit the jackpot from software development can dictate the course of the race.
Without excellent manpower, we have no hope in the high-end market. We will miss our opportunity to surf the future wave without a dedication to software. The face of Samsung Electronics’ chief executive Choi Geesung does not look bright in spite of the company’s record earnings.
*Translation by the JoongAng Daily staff.
The writer is an editorial writer of the JoongAng Ilbo.
By Lee Cheol-ho