The Building on Teheran-ro and the Death of Pride
I took a taxi and headed for Teheran-ro in Gangnam.
On weekends, the streets of Gangnam had a strange, almost surreal feel to them.
On weekdays, the roads would have been choked so tightly with office workers, luxury sedans, and buses that there would hardly be room to breathe, but now they were eerily quiet, as if someone had lied about the whole city and walked away laughing.
Vroooom.
The taxi tore across the asphalt without a single stop.
Outside the window, glass-walled towers bearing the names of major conglomerates slipped by like a folding screen laid out one panel after another.
Back when I was doing construction work in my past life, I busted my ass building places like that.
Of course, the buildings I worked on weren’t Gangnam landmarks or anything of the sort.
But I had built plenty of things—IT company offices in Pangyo, event halls in the provinces, that sort of work.
“Young man, we’re here.”
“Ah, yes.”
At the driver’s words, I snapped back to reality.
I paid by card and got out of the taxi.
And the moment I stepped onto the sidewalk, the building Zero had recommended rose before me, towering straight into the sky.
“Oh…”
It really did look like something Zero would recommend.
A sleek, refined tower with a full glass façade. At twenty-five stories high, it overwhelmed every building around it.
And it was right in the middle of Teheran-ro—an ultra-prime location, directly connected to the subway station.
It truly had everything.
How much did you say this building costs?
At current market value, approximately 260 billion won.
…That’s less than I expected.
The thought slipped out of me before I could stop it, and I jerked in surprise.
For 260 billion won to look cheap to me.
Well, it’s not even four percent of my total assets.
Clomp, clomp.
I walked slowly around the building, taking it in from every angle. Its maintenance was excellent, too.
I’d done a fair amount of demolition work back in my laborer days, so I had a rough eye for how well a building was being cared for just by looking at the outside.
But there was one thing that bothered me.
Why is that little building stuck right next to it?
Right beside the grand tower stood a much smaller building that looked to be seven or eight stories tall.
Forget that it spoiled the sleek exterior of the building I wanted to buy; it was also blocking light from the lower floors and making the whole thing feel cramped.
I don’t like that building.
Now, how should I handle it in a way that would earn me a reputation for handling it well?
Zero. What if I bought the building next to it too and just tore it down?
What would you build in its place?
Something like a café or a park. A private rest area just for our employees.
Building a park instead of another structure in the middle of Teheran-ro?
People might call it insane.
But if it was my company, I felt like having a park wouldn’t be such a bad idea.
I wondered what Zero thought about that.
It is an excellent idea, Master. At present, the only company with a dedicated private park of that scale is Google in Silicon Valley. If we provide that kind of welfare, the headquarters’ value would rise by at least twenty percent. Not to mention the morale of the employees we’ll be hiring in the future.
Really?
Yes. This is not merely wasteful spending. It is a lure for attracting top talent and a piece of branding that will elevate the company’s image.
Okay. Then have Vincent handle that too. The whole thing, including setting up the Korean branch.
Understood.
I’d seen the outside well enough, so I decided to go inside and have a look around too.
While Kim Dohyun was out shopping for buildings on Teheran-ro, a serious meeting was underway in another part of Seoul, in Seocho-gu.
The large conference room at Seongsam Group headquarters in Seocho-gu.
From Friday all the way to Saturday afternoon, the lights in the thirty-fifth-floor conference room had never gone out.
Drinks and coffee, ashtrays, and dozens of reports were scattered messily across the conference table.
This was where the core leadership of Seongsam Electronics, the number-one conglomerate in South Korea, had gathered.
The air was cold and heavy as steel.
“Nasdaq has crashed again. This is a sign that the financial crisis isn’t over—it’s now spreading into the real economy…”
“Exchange-rate volatility is too severe. At this point, it’s impossible to defend our export profit margins.”
“Even the defensive stocks in the U.S. are wavering…”
“Commodity prices…”
The bleak reports kept coming, and no one had much of a solution.
Normally, Vice Chairman Lee Jaeyoung would have let out a sigh and demanded an answer with a hard edge to his voice—So what exactly are you all saying we should do?—but today he merely sat in silence, listening with his eyes closed.
What he was truly worried about wasn’t America’s economy or exchange rates.
America will recover eventually. Doubting or worrying about America is just stupid.
“Enough.”
The vice chairman cut off the report in a low voice.
He sighed, opened his tired eyes, and looked around the conference room.
“Let’s stop with the number-crunching. Talk to me about the real reason we’re gathered here.”
His gaze landed on the head of the wireless business division.
“Head of Wireless, what’s the countermeasure for Apple’s entry into the domestic market? You’ve come up with one by now, haven’t you?”
“……Yes.”
The wireless division head swallowed dryly before speaking.
“At present, we’re cooperating closely with the carriers to delay the iPhone’s entry for as long as possible. We’re using the mandatory WIPI installation requirement as a shield, but…”
“That’s something we’ve been doing from the start. The government already decided to abolish WIPI this past April.”
“……”
“How much longer did you think stalling would work? Frankly, if Apple offers the carriers sales subsidies and persuades them, couldn’t they come in as early as this April?”
The vice chairman frowned.
At present, Seongsam Electronics was the king of the feature-phone market—at least domestically.
But the news coming across the ocean warned that even Seongsam’s fortress might collapse in an instant.
Nokia’s market share has been cut in half. Motorola’s stock dropped sixteen percent yesterday. This isn’t someone else’s problem. By Monday, foreign investors in our stock could start bailing out. No— they absolutely will.
That didn’t mean Seongsam Electronics was trying to resist the smartphone trend.
They had already launched a domestically made smartphone called Romnia, and it ran Microsoft’s “Small Windows” OS.
They had poured incredible effort into it.
But…
That precious little phone they worked so hard on is already being called the “Rom-bullshit,” a mashup of Romnia and trash.
Seongsam had marketed the Romnia phone as All-Powerful Romnia.
But consumers were not impressed.
So now we’re trying to build a new smartphone by making our own OS…
“When will our in-house OS, ‘Bada,’ be finished?”
At that question, the wireless division head’s voice tightened.
“We’re accelerating development as much as possible at present.”
“I asked when.”
“……Vice President, if we build our own ecosystem, we can absolutely compete with Apple. At the very least, we can stay ahead here in Korea. Our hardware specs are overwhelmingly better than theirs. As long as performance is good, phones will sell. So please, just give us a little more time and let us put an OS optimized for our devices on top of it—!”
Midway through his plea, a voice came from across the room.
“You still don’t understand that the very premise of that thinking is wrong?”
It was the head of the Future Innovation Office—a heavyweight who stood as Seongsam Electronics’ number four, maybe number five, depending on how one counted.
They were the same age, but his rank was higher than the wireless division head’s.
The wireless division head’s brow twitched at the icy tone, but the head of Future Innovation ignored him and continued speaking to the vice chairman.
“Vice Chairman, why do you think the Apple phone has been selling in such huge numbers not only right after launch, but even recently?”
“Because people are naturally interested in a new phone.”
“The reason you can only think as far as that is exactly why you’re not fit for the job, Director.”
“……What did you say?”
The wireless division head’s face hardened at the insulting words, even though they came from a colleague of the same rank.
Whether he liked it or not, the head of Future Innovation addressed the vice chairman again.
“The reason Apple phones are winning consumers over isn’t simply because they’re pretty. You have to look at the software inside them.”
“Software?”
“Yes.”
When the vice chairman asked again, he went on.
“Let me use the United States as an example. Apple phones were enormously popular when they first came out. And yet middle-class buyers and students still didn’t use them because they were too expensive, while salaried workers with comfortable incomes kept using their familiar Blueberry phones.”
“That’s true.”
“But over just the past few weeks, Apple phones have spread explosively among the middle class and students. The same is true among office workers. The reason is clearly the software—more precisely, the application.”
“What application?”
“There are several, of course, but I believe the application that played the biggest role was FreeChat. It was released at a truly perfect moment. For the details…”
He lifted a finger and gestured to the secretary standing behind him.
“Secretary Anna-hui, the documents you brought.”
“Yes, sir.”
At his signal, the secretary carried the file she’d been holding to the conference table and began passing it around.
Click, click.
In the quiet conference room, the only sound was the secretary’s high heels against the floor.
The documents she handed out contained analysis and reports on FreeChat.
After reading the report quickly, the wireless division head asked the head of Future Innovation, “So… you’re saying American consumers are buying those insanely expensive Apple phones just to send free texts? Hah, that’s ridiculous…”
“It’s not just because of ‘free texting.’ The point is that using that app to communicate is becoming a trend, a current. Everyone around you uses it, all the popular people use it, and you’re the only one who doesn’t? Then you’re left out of the group and fall behind the fashion. That psychology is pushing consumers to open their wallets, even when it hurts.”
“……”
“And I’m sure there’s also resentment toward the carriers charging outrageous fees. The telecom companies crashing on Nasdaq yesterday probably had something to do with that too. But if we’re talking about ‘outrageous fees,’ Korean carriers are no different, are they? If Apple and FreeChat enter Korea, we could end up in the exact same crisis the American carriers and feature-phone makers are facing.”
At that, the wireless division head glared at him and asked, “So what exactly are you suggesting?”
“We should give up on the in-house ‘Bada OS’ we’ve been developing and adopt another OS so we can launch a smartphone quickly. We already have the hardware expertise to make smartphones, so if we can get an OS, we can release a new phone right away.”
“What did you say?! You want us to throw away the results of all the work our developers have poured into this, without even showing it to the market? And all the development costs—!”
“We’re talking about several hundred billion won in development costs. I know. But so what? That’s a sunk cost.”
The head of Future Innovation let out a sigh.
“Let’s say we finish Bada OS and put it into a smartphone. If we’re lucky, we might be able to launch that phone by the end of this year. But do you honestly think Apple is going to wait for us until then? Are they going to shut down their factories and sit around? By the time we release a proper smartphone, consumers will already be buying Apple phones.”
“……”
“And even if we somehow produce a great smartphone with our own OS in it, consumers will still say things like, ‘Seongsam’s phone has good hardware, but there’s nothing to do on it. There are no apps. Apple’s phone has decent hardware too, and it has tons of fun apps.’ They won’t use ours.”
His words were relentless, as if he had already prepared every line he would need.
The wireless division head could only tremble his lips in silence.
As the two men merely glared at each other, the vice chairman asked the head of Future Innovation, “So, Director Kim, what’s your alternative? If we’re to abandon our own OS, what do you suggest?”
“We need to join forces with Google.”
“Google?”
“Yes. Google already has Android OS, and it’s the only viable counterweight to Apple’s closed-off policy. We need to swallow our pride and put their OS on our phones.”
At once, the conference room erupted into murmurs.
What is he saying… does he want us to become a subcontractor for Google?
If the guys at the Suwon research center hear this, they’ll flip their lids. How much money did we pour into OS development, and now we’re supposed to scrap it?
Google? Isn’t that just some internet company that does search? Do they even understand how phones work?
We’re supposed to install an unproven OS on our phones? That’s ridiculous!
If we make only the hardware and use Google’s OS, they’ll end up holding the reins.
Director Kim! Do you really think the chairman would sit still if he heard that?
Right now, Seongsam’s top developers were all focused on the OS field.
And now he wanted them to give that up, concentrate on hardware, and bring in Google’s OS.
It was, in the truest sense of the word, a decision that meant throwing away pride.
Ignoring the criticism aimed his way, Director Kim spoke again.
“And an OS alone isn’t enough. In the end, the heart of a smartphone is the application. The reason consumers are buying iPhones now isn’t simply because the hardware is pretty—it’s because there are so many apps they can enjoy on it.”
“Does Google’s OS not have many applications?”
“Not yet. But once they have the OS, all they need is the smartphone hardware to run it, and the apps will come quickly. That’s what worries Google.”
“That they don’t have a smartphone of their own to put their OS on?”
“Yes. But they also don’t like just putting it on any random phone.”
“Hmm…”
“So before other handset manufacturers make a proper smartphone and reach out to Google, we need to extend our hand first. Let me say it again: we have the hardware.”
“And after that?”
“We need to work with Google to bring in promising app developers and companies, and invest in them. If we don’t secure killer content that runs only on our phones, we won’t be able to stop Apple’s one-man show.”
The vice chairman sank into thought.
Abandoning our own OS and allying with Google… and investing in software.
For a hardware powerhouse like Seongsam, it could be a humiliating choice.
But instinct told him one thing.
Right now, the head of Future Innovation was right.
“……Director Kim is correct.”
The vice chairman’s low voice echoed through the room.
Everyone went still.
At the vice chairman’s decision, the wireless division head lowered his head.
“Contact them with something like, ‘Google has the software but lacks hardware, while we have the hardware, so let us form an alliance.’ Negotiate on the most favorable terms possible. But since we can’t abandon the Bada OS we’ve already developed, we’ll use Android OS for the time being while continuing to develop Bada OS in a two-track strategy. And…”
His gaze shifted to Director Kim.
“Director Kim.”
“Yes, Vice Chairman.”
“Do you happen to have any developer companies or apps you’ve been keeping an eye on? Somewhere we could invest immediately and make into an ally?”
The head of Future Innovation answered as if he’d been waiting for the question.
“A new American startup: Another Technology.”