The IoT Breakthrough
The breakthrough that would complete Fantasy Universe’s innovation. Once their anxiety faded, the president and executives of the home appliance division found themselves flooded with curiosity. They were also quietly impressed by the young chairman’s sheer nerve—he hadn’t so much as blinked at reports of losses in the hundreds of billions of won. After all, ID Group’s annual net profit routinely exceeded ten trillion won. Its high-value operating systems and software divisions commanded an unshakable presence, while its internet infrastructure, internet-based services, and mobile businesses were equally formidable. Even its finished computer products sold in impressive volumes. Within this empire, the home appliance division was the single blemish.
That was why the division’s president, executives, and employees all shared the same quiet dread: divestiture. They were certain that any other chaebol would have done exactly that. Losses in the hundreds of billions would have triggered furious demands for solutions, and if those failed, the division would have been packaged and sold. These days, the hottest management book in Korea was Jack Welch’s Winning, with its doctrine of ruthless pruning—any business that could not be number one or at least number two had to be cut. Even after graduating from the IMF crisis, many Korean companies were still racing to reinvent themselves, and Welch’s “number one or two” rule was the most popular model. Nothing turned corporate performance around faster or more easily than restructuring. If ID Electronics simply sold off its entire home appliance division, its 2001 results would improve by nearly one trillion won. The division’s net loss was only around five hundred billion, but the additional costs of maintaining salaries and factory facilities pushed the real burden much higher.
That was why the executives had been so terrified when Yoo Jae-won summoned them to America. They had feared he had already decided to sell. To their immense relief, he showed no interest in divestiture. Instead, he promised to demonstrate the same “chairman’s magic” he had already shown the other affiliates. Among ID Group employees, that phrase referred to a shared legend: a simple suggestion becoming a product that earned hundreds of millions of dollars, a few hours or days of programming producing legendary software, or long-standing problems vanishing in an instant. Other companies tried to burnish their chairmen’s images with PR stunts, but very few could actually deliver results. Yoo Jae-won made it look effortless.
Now the same miracle was being asked to work its magic on the home appliance division—the company’s weakest link. As the president and executives followed Yoo Jae-won down the corridors of his palace-like residence, admiration and anticipation rose with every step. After several minutes of walking, he stopped.
“Here we are.”
He led them into a spacious living room with a sweeping view of the Pacific. It was not the private parlor he and Tiffany usually used, but the grand reception room meant for large gatherings. The vista was spectacular, and the interior design was every bit as impressive as one would expect from the home of the world’s largest conglomerate. Yet the executives could not imagine what they were supposed to see here.
“Didi.”
The sudden call startled the already-tense executives. Didi? Was the secret weapon for ID Electronics named Didi? While their minds raced, a fluffy cat emerged from a corner of the room and sauntered toward Yoo Jae-won.
—Meow!
The deep, tenor-like cry echoed through the room. They had been brought here to witness the breakthrough that would complete the innovation of Fantasy Universe, only to be shown a cat? The situation was incomprehensible. Still, Didi was undeniably adorable. None of the executives kept pets, let alone cats, yet they found their eyes drawn to the creature.
“I was wondering where you’d gone,” Yoo Jae-won said, scooping the cat into his arms. “You were here all along?”
Of course cats did not understand human speech, but sometimes they behaved as though they did. And Didi was so cute that it was impossible not to talk to her. If Yoo Jae-won and Tiffany had a child, all their attention would naturally shift, but that had not happened yet—and they had no plans for one anytime soon. Yoo Jae-won expected to be relentlessly busy until at least 2010, and Tiffany was still competing in the race to succeed her grandfather at Chevron. There simply was no time for children. Yoo Jae-won’s parents in Deokjin-ri longed for grandchildren, but after hearing his explanation they had understood completely. Besides, because he and Tiffany had married young, having a child around 2010 would pose no problems at all.
“Didi, what have you been up to? Bullying Jindol again?”
—Meow!
Didi cried out indignantly from within his arms and began to squirm. Understanding that she wanted down, Yoo Jae-won set her on the floor and called another name.
“Jindol!”
The executives expected another pet. What appeared instead was something entirely different.
Tap-tap. Tap-tap.
A rhythmic sound like hooves on marble echoed through the room.
“Hah!”
One of the executives gasped. The newcomer was not a living animal at all.
“A robot!”
It was a large dog-shaped machine, its smooth, hairless body a deep metallic gray accented with silver chrome. The tapping sound came from its plastic legs striking the marble floor—nothing like a cat’s soft paws.
“This is Jindol, our robot dog,” Yoo Jae-won said.
The name suited the sturdy machine. Its prototype had been a Jindo dog, so its legs were long and its ears sharply pointed. “It’s equipped with artificial intelligence. It serves as both a companion and an indoor security guard.”
The manufacturer was Boston Dynamics; the design had been handled by ID High Tech. The most critical components—the operating system and lightweight AI algorithms—had been created by ID Technology, with Yoo Jae-won personally overseeing the work.
“Sony has its own robot dog, but this is on an entirely different level. Please, have a seat.”
He guided the stunned executives to the plush sofas. Once everyone was seated, Jindol trotted over to Yoo Jae-won, wagged its tail, and settled beside the sofa. The executives stared in open amazement. The machine looked as though it had stepped straight out of a science-fiction film. Its double-jointed legs moved with perfect realism; when it sat with its front legs extended, the posture was completely natural.
Of course, with current technology such a device was entirely feasible. It used the safest lithium-polymer batteries, and its sensors were the same models found in Android Phone. Its processor was the MAP3. The AI was sophisticated enough to mimic a dog’s behavior, though it possessed no true independent will.
“Normally it behaves just like any other dog. When it hears a sound, it runs over to investigate.”
Its eyes contained high-performance CCD cameras, allowing the household to be monitored remotely. “Like this.”
Yoo Jae-won took out his Android Phone, tapped the Jindol icon, and a live video feed appeared. The executives murmured in admiration. The principle was simple enough—a built-in webcam. The CCD in Jindol’s eyes captured footage that the MAP processor and encoding chip compressed into high-quality, low-bandwidth video, then transmitted over Wi-Fi to the phone.
“Jindol is only a prototype. The commercial version will have somewhat reduced specifications. Even so, this single product could earn ID Electronics worldwide recognition. Sony opened the robot-pet market but never achieved mainstream success. Jindol, however, could make ID Electronics a household name and establish it as a leader in cutting-edge appliances.”
“And Jindol isn’t the only AI robot we’ve developed.”
He glanced across the room. A flat, round device was quietly sweeping the floor—an AI-powered wireless vacuum cleaner. After seeing Jindol, the executives were less impressed, yet the technology was nearly identical. The only real difference was legs versus wheels. In some ways the vacuum was even more advanced: it used ultrasonic sensors to detect obstacles, remembered the location of its charging dock, and tracked which areas it had already cleaned.
“It can also be controlled through the Android Phone,” Yoo Jae-won continued. “You can check its status, see how full the dustbin is, and receive alerts when it needs emptying. You can even wake it from sleep and send it to clean.”
With every new detail, the executives found it harder to hide their astonishment. These were appliances on an entirely different plane from anything currently on the market. Still, a few faces darkened. Impressive as they were, neither the robot dog nor the vacuum would be enough to turn around the division’s financial performance. Jindol looked prohibitively expensive, and the vacuum, while novel, would never replace conventional models for most households.
“Chairman…” one executive began hesitantly, but Yoo Jae-won was already ahead of him.
“I know what you’re thinking. This isn’t all I wanted to show you.”
He had expected their concern. In fact, he was pleased that they had immediately begun calculating costs and benefits rather than being dazzled by the robots alone. He knew perfectly well that Jindol and the vacuum cleaner would not solve the division’s problems.
“Can any of you tell me what Jindol and the vacuum cleaner have in common?”
The president of the division answered at once. “The internet.”
“Exactly. And what do we call the connection between objects and the internet?”
The executives remained silent. The concept of the Internet of Things was still confined to university research labs; it had first appeared in 1999 at MIT’s Auto-ID Center but had never been demonstrated with practical examples until now.
“We call it IoT—the Internet of Things.”
The executives repeated the term quietly to themselves. It was not difficult to grasp once they had seen Jindol and the vacuum in action.
“Come with me. I’ll show you what happens when we apply IoT to white goods.”
He led them into the kitchen, where Tiffany and the professional chefs were preparing a meal. There stood a large double-door refrigerator and a dishwasher, both fitted with sizable LCD touchscreens. In the laundry room they saw a drum washing machine and dryer. In the dressing room was the clothing-care appliance called the Styler. In the private living quarters they viewed a large LCD television. Every appliance bore the tiny ID logo in one corner—easy to miss at first glance.
The executives were struck by a different kind of awe than they had felt with Jindol. These were not futuristic prototypes; they were current technology rendered with extraordinary refinement. Even more astonishing was the fact that every single one carried the ID logo. The world’s most exclusive appliance makers had never produced anything quite so elegant. The executives found themselves wondering whether there existed a separate company that manufactured appliances exclusively for the ultra-wealthy—until one of them noticed the logo and the realization hit them all at once.
“Chairman! Did our group manufacture all of these appliances?” the president asked, his voice trembling with excitement.
“Yes.”
“Hah!”
The president could not help the exclamation. The home appliance division was the only factory within ID Group that produced white goods. Yet here were finished products the division itself had never seen.
“They were built at ID High Tech under my direction,” Yoo Jae-won explained. “The institute’s public mission is advanced research—drones, for example. Its quieter mission is to create prototypes of any product I need that does not yet exist. That is how the Tiffany Phone and the tablet PC came to be. These appliances were made the same way. At present, they exist only in this house.”
After hearing the full explanation, the president and executives of the home appliance division felt a surge of genuine admiration—and with it, a deep and humbling sense of shame.