Attracting foreign IT firms

Attracting foreign IT firms

AUG.03,2004

Despite a serious domestic economic recession, foreign information technology, or IT, companies are still seeing Korea as the best market.

These days, foreign IT companies are making advances into the country one after another. Global Internet search engine companies such as Google, as well as online game companies and Internet music services, are expanding operations in Korea or seeking to establish branch offices.

"Although Koreans say that the economy is terrible these days, the IT market growth rate in Korea is still much faster than in Europe or the United States," an industry analyst said. "There are also many firms that want to use Korea as a test market for new products or product functions."

The Information Ministry said this year's IT market scale is 240 trillion won ($205 billion), 30 trillion won higher than last year. "In particular, Internet businesses and online games continued to grow. These factors are very attractive to foreign companies," a ministry official said.

U.S.-based Internet search company Google is planning to create a branch office in Korea. The firm is also looking for partners in domestic portal companies.

Mforma, the largest online game company in the United States, took over a Korean mobile game company last April and set up its first Asian branch in Korea. "The mobile market in Korea is very active and our competitors have a high level of technology, which is appropriate in developing new products," an official at Mforma Korea said. "Our company will place Korea as the key business position for Asia and export products to China, Japan, and Taiwan."
Real Networks, an Internet music service provider, is also planning to set up a Korean branch this year.

MathWorks, the top global developer of engineering software, established a regional office in Korea last February. "The Korean branch is a test platform to see if the company can survive and succeed in Asia," said President Hahm Chang-man.

F5 Networks, a corporate software developer, returned in February after terminating its operations in 2001. Firms that are already located here are expanding their territory. Microsoft is searching for a business partner to develop a solution for smaller companies that want to advance into China. Intel is developing a wireless LAN system and wants to collaborate with KT.