Selection and Focus
November 5, 1994. Yoo Jae-won and the executives of ID Group gathered on Jeju Island. The specific location was a hotel in the Jungmun Tourist Complex, where ID Technology had previously held workshops. The key attendees included Chief of Staff Choi Kang-wook, ID Investment Korea Branch President Hwang Jae-hong, and the president and executives of Nextcomcast who had flown in from Pennsylvania. Those absent were the staff of Android Inc., whose new product launch was imminent, and President Remington of ID Technology along with his team, who were buried in the mass production of the Tiffany Phone. In contrast, almost everyone from ID Entertainment—including President Stephen Barber—and the joint presidents and staff of Blizzard Entertainment, as well as the RTCW team from ID Software, had chosen to come to Korea. President Stephen Barber of ID Entertainment had also entered the country for business purposes, while granting paid vacation to Blizzard and RTCW as a reward.
Even though it was a completely new release, Warcraft continued to show steady sales and had clearly become a success, while RTCW, which updated its sales figures daily, had also become a massive hit. Both teams had worked hard developing their games, so in keeping with tradition, they were given paid leave. That did not mean everyone was forced to go to Jeju Island, however; they were given choices. Famous resorts such as the Maldives and Bali had been offered alongside Jeju. In the end, the majority chose Jeju. Of course, a little persuasion had been applied. They were told that the quiet charm of the winter sea and the lush forests of Hallasan would provide healing and refreshment to souls weary from development. Moreover, since it was a resort Yoo Jae-won himself frequently visited, the developers one after another selected Jeju. The persuasion proved remarkably effective. The RTCW development team, including Romero, had visited once before, so it was thought fewer would choose it again, yet most selected Jeju, apparently because their previous memories had been pleasant. Blizzard employees were drawn to the words “healing and refresh” and largely chose Jeju as well. Finally, President Bolt and the staff of Lightning Bolt also arrived on Jeju. Though his presence was somewhat overshadowed by the many heavyweights, President Bolt had also achieved significant results this year. By releasing the affordable Model 2, he had popularized electric bicycles in Silicon Valley and San Francisco and posted impressive internet sales figures. However, President Bolt had not come to Jeju for a reward trip. He had a role to play in Yoo Jae-won’s Jeju development plans and had come to handle that matter.
“Must be nice,” Yoo Jae-won muttered briefly as he watched the Blizzard and RTCW developers cheerfully leaving the hotel. After arriving on Jeju and completing the short orientation he had led, they began their free travel in earnest. The winter wind on Jeju was somewhat strong, but everyone was dressed warmly and would be traveling by car, so the wind was not a major issue. On the other hand, Yoo Jae-won, with mountains of work still ahead, felt envious of those who could start their vacations so comfortably. It was fortunate that he did not have the grueling tasks that the working-level staff faced. Of course, he was about to make decisions that could determine the company’s survival, so any other executive would have felt far greater stress than simply working themselves to the bone, but Yoo Jae-won was no ordinary person and felt none of that stress. It was simply that because the staff were working so diligently, he felt he ought to show he was also deep in thought, which made staying cooped up in his room rather tedious.
The suite was the largest in the Jungmun Tourist Complex, yet because it was not his own home, there were many inconveniences. “Maybe I should go online for a bit?” Yoo Jae-won sat down in front of the computer. The hotel provided a computer along with a TV and telephone as standard amenities. Surprisingly, it was a Newegg 2 with excellent specifications, so there was no need to take out the Shell Book he had brought. Not every room had a Newegg 2 installed, however; they were only provided in deluxe rooms and above. The internet was high-speed ADSL boasting a full 8 Mbps. Yet the basic internet package came with a data cap, and exceeding it incurred additional charges based on usage. If he used it recklessly just because the speed was fast, he might receive a hefty bill at checkout.
“Well, hotel phones aren’t free either.” Along with the thought that it was excessive, he also felt it was understandable. Although Yoo Jae-won no longer needed to worry about money, his old middle-class mindset still lingered, creating a complex mix of emotions. Once the computer finished booting, the desktop appeared. The only installed application was ID Office. Since this was also bundled software provided with the Newegg 2, no paid programs had been installed. Even the operating system and ID Office came with proper rental licenses.
“Oh, this is perfect. So this is what a five-star hotel is like?” Since it was a Newegg 2, the operating system and ID Office were naturally genuine. The genuine price was included in the consumer price. He had not expected rental licenses to be installed as well, but the final details were flawless. His fondness for the Hyatt Hotel, where he was staying, rose sharply. Rental licenses were expensive and often avoided, so encountering one in an unexpected place felt pleasant.
“In a place where multiple people use the same machine, of course you should use the rental version.” Rental licenses were not merely expensive. When a rental license CD key was installed, a hidden feature called LOCK was activated. It prevented general users from changing pre-set configurations. It also blocked the installation of unauthorized programs. Computers used by many people often had their settings altered strangely or were slowed down by all sorts of miscellaneous programs. If LOCK was applied after installing a rental license, no matter how messily a user treated the computer, a single reboot would restore the original environment.
Cheered by this small discovery, Yoo Jae-won briskly launched the web browser and connected to Nextcom. “Kim Cheol-su, writing a new success story for Korean IT.” “KimLab, President Kim Cheol-su. Building Korea’s pride with thorough security services!” As expected, the first articles that appeared were still about Kim Cheol-su. Compared to smokestack industries, IT businesses required relatively little initial capital and could be started with just an office, a computer, and a brilliant idea. Until now, there had been no success stories besides Yoo Jae-won, so the field had felt somewhat stagnant, but KimLab’s breakthrough had brought renewed attention. Of course, Yoo Jae-won’s choice had played a role in KimLab’s success, but the fact that the company had raised its software to a level worthy of that choice was due to KimLab’s own capabilities.
“KimLab plans large-scale hiring in preparation for the Android 95 release.” “KimLab converts to a joint-stock company and pushes for listing on the KOSDAQ, scheduled to open next year!” “Hmm?” A questioning sound escaped Yoo Jae-won’s lips. The articles he had wanted to see were not these. What he had originally hoped to find were stories about KimLab employees’ welfare benefits or how much performance bonuses they had received from this windfall. Instead, the flood of articles consisted solely of pieces that spotlighted only KimLab and Kim Cheol-su. The article about pushing for a KOSDAQ listing was particularly disappointing. They had not even begun full-scale business yet, and they were already heading straight for the KOSDAQ. What if KimLab’s security program were later deemed underperforming and removed from the market? That would be disastrous. Yoo Jae-won hoped that would not happen. Yet companies that had approached the threshold of success but failed to cross it had almost always collapsed due to poor organizational management. Especially in the security industry, far more companies failed because of internal leaks than because their programs themselves were flawed. Yoo Jae-won believed the core of organizational management was fair evaluation and compensation for performance. That was why he thought Kim Cheol-su, who had just received a large sum of money, should also provide appropriate rewards to the employees who had dedicated themselves alongside him. Instead, there was no such news—only announcements of hiring new staff and pursuing a KOSDAQ listing—which left him frustrated.
“Are they planning to offer stock options at least?” Yoo Jae-won preferred cash, but stocks were not bad either. Given the current flow of the Korean economy, once the KOSDAQ opened, it would almost certainly rise for a while. He could say this with certainty because the amount of money banks and companies were releasing was enormous. There was simply too much money circulating in the market with nowhere to go. Thanks to this, apartment and land prices continued to climb, and if the KOSDAQ emerged amid the IT boom, all that restless capital would surely pour into it.
“Speaking of the KOSDAQ, it reminds me of Saerom Technology.” Saerom Technology was the stock that clearly demonstrated the initial bubble of the KOSDAQ. Its face value of 5,000 won had soared past 3 million won—an absurd rise. Yet despite that massive surge, its substance was unclear. Its only offering was a free phone service using VoIP. In contrast, KimLab had already generated revenue through its contract with Android Inc. Furthermore, as computers and the internet became more widespread, demand for security would steadily grow. It would be preferable for KimLab, whose revenue model was far more solid than Saerom Technology’s, to rise instead. In reality, Saerom Technology’s stock had become worthless, while KimLab at least continued to survive.
“They’ll handle it themselves.” Yoo Jae-won’s thoughts ended there. Even if the KOSDAQ opened, he had no intention of investing in KimLab, let alone Saerom Technology. Just then, a knock sounded at the door. It seemed the time had come. The presentation that would determine Nextcomcast’s future took place in Yoo Jae-won’s suite. Because the presentation would reveal Nextcomcast’s corporate secrets, holding it in an event room like a regular gathering would have been inappropriate. That did not mean the atmosphere was stiff, however. ID Group’s corporate culture was far more relaxed than that of Korean companies or even many American IT firms. A portable projector was connected to a Shell Book, and a white wall served as the screen. Chairs from the suite were arranged for the audience. Yoo Jae-won sat in the central seat of honor, with Chief of Staff Choi Kang-wook, Strategy Planning Director Lee Hyun-woo, President Hwang Jae-hong, and other executives seated beside him. Strategy Planning Director Lee Hyun-woo was in his early thirties, younger than Choi Kang-wook. Nevertheless, half his hair had turned white, making him look older than Choi Kang-wook at face value. It was said he had endured many hardships at a young age. That experience made him highly capable in many areas and outstanding in practical execution. Whenever Yoo Jae-won created something new, Lee Hyun-woo handled the concrete measures needed to implement it. For the past several months, he had been working with Hwang Jae-hong on matters related to Jeju, and today he would finally see the results. After the Nextcomcast presentation, the next scheduled presentation belonged to Hwang Jae-hong and Director Lee Hyun-woo.
“Shall we begin?” Once preparations were complete, President Henry rose at Yoo Jae-won’s words, and the presentation started. “Dromaeosaurus?” When the first slide—bearing the small ID logo at the bottom and the large Nextcomcast logo in the center—was turned, a typical carnivorous dinosaur, a raptor, appeared. President Henry looked momentarily flustered. The name that had appeared was far longer than the one he knew. “Yes, a raptor.” Fortunately, he realized that Dromaeosaurus and raptor were similar species and smoothly continued. “Yes, Mr. Chairman. The goal Nextcomcast should aim for is precisely a nimble predator like that raptor.” The raptor was a predator yet small in size. Research showed it moved in agile, swift packs while hunting, and President Henry had concluded that this image should be transplanted directly onto Nextcomcast. To transform Nextcom in line with trends and launch various internet sites in response to rapidly changing market demands, a small, agile organization was essential. The same applied to the cable business. While backbone networks like the Information Superhighway had to be built directly, he believed it was unnecessary to expand directly into every small city. Although a sharp increase in subscribers was desirable, it would also require hiring more staff to manage them. Since costs would rise in proportion to profits, he judged it better to lease to regional cable companies and receive steady lump-sum payments as they did now. President Henry’s thinking had been included in the report sent last month, and it was now presented in a more organized and clear form through this presentation. Next came Julian A. Roberts, the current CFO and vice president of Nextcomcast. The name Julian somehow carried a charm that made one imagine its owner as a beautiful youth. Yet the man standing before Yoo Jae-won boasted a physique 1.5 times larger than President Henry’s. As CFO—chief financial officer—he was in charge of Comcast’s fund management. He was one of the few executives from the former Comcast who had been retained, proof that his abilities had been recognized.
“Mr. Chairman! Money bags that can be grabbed with just an outstretched hand are scattered everywhere. As an entrepreneur, shouldn’t you naturally seize them?” His presentation style was completely different from President Henry’s. While President Henry used concise metaphors to convey his arguments, Vice President Julian’s approach was entirely direct and macho. “I simply cannot understand why we should lease the backbone network that you, Mr. Chairman, poured enormous funds into building to regional networks. There’s a Korean saying about cooking porridge only to give it to a dog—surely we are not a charity organization? If we need a sales network, we should simply acquire those regional network companies!” Although his use of the proverb was slightly off, Vice President Julian’s point was clear: in regions where Nextcomcast’s current network was weak, they should simply acquire regional network companies and expand. While the sales network would expand dramatically, the organization would also become that much larger. Henry’s and Julian’s approaches were thus starkly different. Both presentations concluded, followed by questions from the executives. Both presenters had prepared thoroughly, answering every question without hesitation. Now only Yoo Jae-won’s choice remained.