Security fortresses to rout moles

Local technology companies have increasingly become targets for industrial espionage. According to prosecutors, reports of information theft more than doubled from 207 cases in 2005 to 439 last year. The latest target was active-matrix organic light-emitting diode (Amoled) displays for 55-inch next-generation TV sets under development by the country’s major electronics makers, Samsung and LG. The suspected moles were local employees of Israel-based automated optical inspection company Orbotech, which supplies Samsung and LG with quality-control equipment for display panels. The suspects were not professional agents, but mere employees who had been bribed to trade technology secrets. The two electronics giants not only lost enormous pools of research funds due to the leaks, but also lost face for having been easy prey by amateur spies.

The stolen Amoled display technology has been designated a national core technology. Samsung and LG have been developing the displays, which are popularly fitted on smartphones and other mobile devices, for application to large TV sets. They expect to reap huge profits once TVs are mass-produced using Amoled technology, which offers peerless clarity for images and readability. The industry expects global Amoled demand will reach 90 trillion won ($78.6 billion) over a five-year period starting from 2013. But local companies face heavy competition from their Taiwanese and Chinese rivals. Prosecutors suspect the design information in the recent leakages was sold to Chinese panel producer BOE and Taiwan’s largest display maker, Chimei. And Samsung and LG will suffer heavily if their rivals gain such an advantage. Prosecutors estimate the revenue losses could reach 30 trillion won.

The suspects need to be investigated thoroughly, and prosecutors should seek international cooperation for their efforts to search the Israeli company’s Seoul office. Such tough measures could fend off future espionage attempts. Meanwhile, local companies should enhance their security systems. If global companies like Samsung and LG are vulnerable to amateur spies, it goes without saying that other companies are probably even more at risk. Once intellectual property is leaked, it is hard to receive compensation for the damage. Manufacturers must construct more impenetrable security fortresses to protect their hard-won products and technologies.