The Crossroads of Expansion
Unfortunately, the round dots did not cover the entire North American continent uniformly. They clustered densely along the West Coast, the East Coast, and the central United States, forming a flattened H-shape when connected. The pattern overlapped almost perfectly with the planned route of the Information Highway Phase 1 project, which had been designed to link the East Coast, West Coast, and the heart of the continent.
“I imagine you’re thinking this looks very similar to the Information Highway Phase 1 project. You would be correct,” Henry Samuel continued. “Nextcomcast’s broadband internet service area currently aligns closely with the regions the Information Highway already passes through. However, broadband service can still be provided in areas the highway cables do not directly reach. If we compare the Information Highway to the human body, it functions like the main arteries. By installing regional networks—branch lines and capillary-like connections—we can easily reach even the most remote counties.”
“The problem is that Nextcomcast’s current organizational capacity is already stretched thin just maintaining its present performance. In short, while countless customers are applying for broadband, the number of field technicians—commonly called cable guys—who actually perform the installations is severely insufficient.”
“Really? The labor shortage is that serious?”
“It is, Mr. Chairman. The issue is especially acute in satellite cities located some distance from major metropolitan areas. In Los Angeles proper, installations are typically completed within four days of application. Yet in satellite cities like Palmdale or Victorville, a week is standard, and delays exceeding ten days are not uncommon.”
Yoo Jae-won had not realized the situation was this dire. After all, Nextcomcast employed well over twenty thousand people. Only a few hundred of them were original Nextcom staff; the rest had been carried over from the former Comcast. Because of these large numbers, Yoo Jae-won had often excluded Comcast’s workforce when assessing ID Group’s overall headcount, fearing that including them would distort the picture of the group’s true scale.
In any case, he had assumed Comcast possessed a massive workforce, yet the reality was that the numbers were still too small. To build a sales network capable of covering every small town across the entire North American continent, they would need several times the current staff.
“Your timing with that directive was impeccable, Mr. Chairman. It made us realize Nextcomcast stands at a crossroads of choice,” Henry Samuel said simply. One corner of the transmitted image displayed the total number of broadband subscribers: precisely 4,275,350. The trend showed roughly two hundred thousand new subscribers each month—approximately 2.4 million per year. Cable subscribers had already surpassed six million several months earlier, adding about 260,000 new customers monthly. It was respectable growth, but it had reached its limit. Actual demand was exploding far beyond these figures. Fortunately, competitor Warner Cable had also failed to fully prepare for the internet era; had they done so, they would have captured much of this demand.
“There are two options. One is to lease our Information Highway infrastructure to regional networks or competitors. The other is to expand our organization and extend our sales network.”
“That is correct, Mr. Chairman.” The Henry Samuel on the monitor looked visibly surprised. He had been preparing detailed explanations of both options when Yoo Jae-won had already pinpointed the core choices.
“Which do you think is better, Mr. President?”
“I favor the former.” Without hesitation, Henry Samuel chose leasing.
“Demand is surging now because we are still in the early days of the internet, but by the twenty-first century the market will become a red ocean. Any workforce expanded without careful planning will likely become a heavy burden. It was a reasonable point. Yoo Jae-won nodded in agreement. Recalling Comcast’s past, he remembered that at its peak the company had employed 150,000 people directly. Ironically, despite its enormous size, it had always suffered the worst customer reputation and was notorious for exploiting its employees—a textbook example of a black company. Users had to endure painfully slow internet speeds paired with expensive metered billing, and after-sales service for outages was poor. Employees worked hard confronting customer complaints, yet problems kept piling up faster than they could be resolved. It was a situation where both customers and staff suffered.”
“Is this the final conclusion from Nextcomcast, then?”
“No. Many of the directors hold different views.” Yoo Jae-won nodded as if he had expected this. The former Comcast executives would argue that simply adding a few more staff would increase the size of the pie they could directly consume, so why lease anything out?
Yoo Jae-won paused in thought, then reached a decision.
“This decision will determine Nextcomcast’s future. It seems too important to settle based on a brief summary report alone.”
“You are absolutely right, Mr. Chairman. I was only providing a concise overview. I had planned to submit a formal report with detailed data immediately.”
“I was waiting for that as well. Since there are opposing opinions internally, why don’t you and the directors come present your cases? We can hold a proper presentation. Coincidentally, there is related business in Korea as well.”
“In Korea, sir?”
“A good idea. We can prepare materials, clarify our positions, and reach a solid conclusion through a joint presentation.” Henry Samuel responded promptly to Yoo Jae-won’s request. No executive could refuse the group chairman’s summons. Henry Samuel himself felt the same, though he harbored a slight concern—that this matter might surface the underlying tensions between ID Group appointees and the former Comcast faction. Even blood brothers could quarrel over profit, and Nextcomcast, being an acquired company, still retained cultural differences. Yet Nextcomcast was undeniably part of ID Group, and Yoo Jae-won held the largest stake. If anyone’s dissatisfaction ran so deep they refused to comply, their only option would be resignation. Henry Samuel thought it might not be a bad thing if this process filtered out the most discontented individuals.
“Understood, Mr. Chairman. By the way, what is this Korean business you mentioned?”
“The audio-on-demand service and internet radio project.”
“Ah, now I remember. You mean the Next Music service.”
“Yes. The relevant legislation has finally passed. Once we secure the license through proper negotiations with the Korea Music Copyright Association, we can proceed.”
In addition, a public tender notice would soon appear for building a computerized network to accurately track music sales figures and an integrated system for systematic copyright royalty calculations. The system would handle royalty settlements for sound sources used not only in digital files but also in karaoke establishments, broadcasting stations, and various businesses. Currently, the only large IT company in Korea capable of developing such a system was ID Group, making the outcome essentially predetermined.
“Understood, Mr. Chairman. We will prepare the Next Music project thoroughly before arriving in Korea.”
The ID Talk conversation with Henry Samuel ended there. The detailed discussion could wait until he arrived in Korea. Besides, a conversation request from Kevin Johnson, president of Android Inc., had been blinking for some time, so Yoo Jae-won kept the computer open and continued the chat.
“This is Kevin Johnson of Android Inc. I am reporting that final negotiations with the Secure Area support vendors have been concluded.”
“So the results are finally in. What about the pricing?”
Although the candidates had been selected some time ago, price negotiations had dragged on without resolution. Yoo Jae-won had nearly forgotten about it, but now a conclusion had been reached.
“All three vendors have been aligned at the same price points. GE is one dollar, WE is three dollars, and EE is ten dollars. The multi-user version you recently requested is fifteen dollars.”
“Wow, that’s much better than I expected.” Kevin Johnson’s negotiating skills were clearly effective. The prices had landed at the lower end of Yoo Jae-won’s anticipated range. GE referred to the personal Gaming Edition, which included the ad-supported version. WE stood for the Workstation Edition, and EE for the Enterprise Edition used in large-scale corporate systems. Naturally, the security program features varied according to price. The GE version contained only the most basic functions, while the EE version included the full suite of capabilities.
“We have also finalized the consumer prices including the Secure Area fee.” Kevin Johnson sent over an IDW file. When opened, it revealed a catalog detailing the various versions of Android 95, with prices prominently displayed: GE at twelve dollars, WE at one hundred twenty dollars, and EE at one hundred ninety dollars. This represented roughly a thirty percent increase compared to Android 2.0 pricing. Accounting for inflation between the Android 2.0 launch and the present, the real increase was closer to twenty percent.
“Have you sent this catalog to our partner companies as well?”
“Yes, Mr. Chairman.”
“What has their reaction been?”
“There were some complaints about the price increase, of course. However, no one has terminated contracts or reduced order volumes.”
Yoo Jae-won nodded with satisfaction at Kevin Johnson’s message. The best-selling model among major finished-PC manufacturers was the home PC, which came equipped with the Gaming Edition operating system; higher-tier versions were rarely installed. For these manufacturers, the added cost per package was only about 2.1 dollars—negligible compared to finished computers starting at one thousand dollars. The real issue was the EE version, whose price had jumped sharply from one hundred twenty to one hundred ninety dollars. Yet Android Inc. had strong counterarguments. The EE version shipped with enough supplementary programs to fill two CDs and was engineered for large-scale systems with maximum stability and the latest features. Furthermore, maintenance required A-level Android engineers to visit client sites as needed, inevitably increasing costs.
The key variable would be sales volume of the newly created Workstation Edition. Designed for professionals, its target audience was far more ambiguous than the original versions clearly aimed at home users and enterprises. It was intended for video and music professionals, as well as high-performance workstations occasionally offered by major PC manufacturers. This was also why Yoo Jae-won was launching the iWorks workstation product for the first time. Still, even he could not easily gauge how strong demand from these professionals would be.
“The advertising slot prices for the Adware version have also been finalized.” The Adware policy—displaying small image advertisements in the lower right corner upon boot-up or at one-hour intervals—was still in effect. However, technological advances had changed how the ads functioned. In the past, clicking an ad might only bring up a simple flyer, or sometimes nothing at all. Now, clicking took users directly to the advertiser’s website as standard. Advertisers prepared rich homepages, allowing them to maximize effectiveness according to their capabilities. Most importantly, just as many people used assembled computers as finished PCs from major manufacturers, and most of those users chose the Adware version. Their numbers continued to grow steadily. Concentrated among the high-purchasing-power demographic of teens through late thirties, the advertising effectiveness remained consistently excellent. Consequently, slot prices had been rising steadily as well.
“The final winning bid sets the unit price per slot at six million dollars. There are twenty-four slots in total. At six million dollars each, that means…”
“We have already secured one hundred forty-four million dollars in revenue before the official launch.”
“Yep! That’s what they call a jackpot, right? And there’s one more jackpot. We also held the finale auction for Android 2.0.”
Even with Android 95’s release, support for version 2.0 would continue for some time. Some users still operated older systems. However, only minor patches for security updates and bug fixes would be issued; major updates were finished. Naturally, this would be the final renewal of advertising slots. Winning a slot now meant the advertisement would remain fixed on Android 2.0 forever, making the auction as fiercely competitive as during its peak period, according to Kevin Johnson.
“Is that so? What was the winning bid?”
“Four million two hundred thousand dollars.”
Yoo Jae-won let out a low whistle. That alone amounted to one hundred eight million dollars. Between the 2.0 finale auction and the first 95 auction, they had essentially recovered the entire development cost of Android 95. Naturally, Yoo Jae-won’s mood was excellent. His bold decision had paid off handsomely. Forgoing direct sales of genuine copies to individual users and instead adopting the Adware model when developing the Android operating system had been the right call. It had even generated more butterfly effects than he had anticipated. The advertising auction itself became a major issue, and the bidding war among participating companies received media coverage. Surpassing even the Super Bowl—which had long boasted the world’s most expensive advertising rates—made it inevitable news. Of course, a Super Bowl spot lasted only thirty seconds and cost several million dollars, while an Android slot ran for one hundred days, making direct hourly comparisons meaningless. Still, the scale of public interest felt nearly equivalent.
Advertisement quality had also improved significantly. After the passage of internet advertising laws in the United States, all ads were required to be clearly labeled as such. Even tiny print was acceptable, but once tagged as advertising, ad-blocking applications could filter them out. As a result, while indiscriminate pop-ups and low-quality image ads had proliferated before, advertisers were now shifting toward content that stimulated user curiosity or offered tangible benefits. Many ads now included discount coupons or featured celebrities. It was a positive change.
Because the advertising slot auction had become such a critical revenue driver for Android Inc., Yoo Jae-won was already contemplating ways to evolve the system further. The most promising approach was customization based on individual user data. Currently, every user saw identical advertisements. In the future, ads could be tailored by gender, age, hobbies, or occupation. The number of slots could be greatly expanded, and precision targeting would multiply advertising effectiveness several times over. The database was not yet large enough to implement this immediately, but it would certainly become feasible after the 95 version or the one following it.
There was more good news the next day. Chief of Staff Choi Kang-wook arrived carrying a large gift package—the first such visit in quite some time.