A fascinating article on the cell phone craze in South Korea!
Kim Hee Young, right, 21, a statistics major, and Choi Yoon Hee, 22, a computer science major, bought food tickets in the cafeteria at at Sookmyung Women’s University using their cellphones.
SEOUL — Kim Hee-young, a statistics major at Sookmyung Women’s University in Seoul, holds more or less her whole life in her hands.
In the subway, Ms. Kim breezes through the turnstile after tapping the phone on a box that deducts the fare from a chip that contains a cash balance. While riding to school, she uses her mobile to check if a book has arrived at the library, slays aliens in a role-playing game, updates her Internet blog or watches TV.
On campus, she and other students touch their mobiles to the electronic box by the door to mark their attendance. No need for roll call — the school’s server computer logs whether they are in or how late they are for the class.
“If I leave my wallet at home, I may not notice it for the whole day,” said Ms. Kim, 21. “But if I lose my cellphone, my life will start stumbling right there in the subway.”
It has been a while since the mobile phone became more than just a phone, serving as a texting device, a camera and a digital music player, among other things. But experts say South Korea, because of its high-speed wireless networks and top technology companies like Samsung and LG, is the test case for the mobile future.
“We want to bring complex bits of daily life — cash, credit card, membership card and student ID card, everything — into the mobile phone,” said Shim Gi-tae, a mobile financing official at SK Telecom, the country’s largest wireless carrier. “We want to make the cellphone the center of life.”
With young South Koreans changing mobile phones once a year, according to consumer groups, it is virtually impossible to keep track of what they can do with the latest models. But the use of mobile devices is so widespread that at any given time, you will see South Koreans of all ages sitting in subways and buses engrossed in watching a television soap opera on hand-held devices, very often their mobile phones. They talk on the phone and at the same time read comic books on its screen. And these comics have sound effects: Phones vibrate when a bomb explodes.
In 2005, South Korea became the first country in the world where mobiles could receive digital television signals — something Americans with their latest iPhones are just beginning to get used to. Like many other places these days, the phone is also a calculator, dictionary and stopwatch; a television remote control and navigator for your car. Newspapers are delivered to mobile phones. Ms. Kim measures her biorhythms with hers. Some even get fired by mobile: In March, a group of taxi drivers rallied after their company sent them a text message of dismissal — a practice that gained notoriety as the country’s economic downturn deepened.
Here, people sometimes even raise pets by phone, part of a global fad that began in the late 1990s with the Japanese invention of the Tamagotchi digital pet. You feed, walk and clean up behind the digi-dog that lives inside your mobile. If you neglect it, it sulks, withers and dies.
Among all these features, however, one enterprise the country’s wireless carriers are banking on is bringing cash and credit to the mobile phone, “thus making South Korea a walletless, cashless society,” said Ju Hee-sang, a manager for mobile cash payments at SK.
Each month last year, four million South Koreans bought music, videos, ring tones, online game subscriptions and articles from newspaper archives and other online items and charged them to their mobile phone bills, without going through any bank or credit card. The amount totaled 1.7 trillion won, or $1.4 billion at current exchange rates, last year. South Koreans have done this since 2000.
From late last year, people use “T-money” — electronic cash stored and refilled in their SIM cards and other phone chips — as Ms. Kim does when she rides the subway and bus or buys snacks from a 7-Eleven at her neighborhood or the vending machines and cafeteria of her school. Instead of giving their children cash, parents can transfer money to their kids’ T-money account.
T-money also makes mobile gift-giving possible. Someone can check into a mobile carrier’s online shop, buy an icon depicting a Starbucks Frappuccino and send it to his girlfriend’s phone. She can then go to the Starbucks, show the icon and get the drink. Each day, 70,000 mobile gifts — from Dunkin’ Donuts and pizza to underwear and cosmetics — are delivered through SK’s networks.
Since 2000, South Koreans also use their mobile phones for Internet banking. For a fixed rate of 1,000 won a month, mobile phone users can check their bank accounts or send money, away from the A.T.M. or personal computer, and sitting, for example, in the taxi.
Mobile phone banking is also gaining a foothold in Britain and the United States. Last year, Citibank began offering mobile-banking software for customers who use the iPhone. The programs were developed jointly with SK. Mobile phones have also emerged as a popular tool of banking in some of the world’s poorest countries, from India to Zambia, where many people do not have a bank or the wired Internet in their villages but have mobile phones.
For South Koreans, efforts to replace credit cards and cash hit their stride in 2004, when banks began issuing integrated circuit chips that slot into the mobile phones and allow them to work like credit cards at A.T.M.’s.
Instead of scratching or feeding the plastic card into the A.T.M., the customer places the phone on a tray-like reader. This year, the wireless carriers began incorporating the same chips into the Universal Subscriber Identity Module, a memory chip that comes with every third-generation mobile phone. The USIM chip can contain up to 100 credit cards and means no more bulky wallet.
Mobile payment has been adopted in many parts of Europe and Asia, especially in Japan. Still, phones have a long way to go before replacing plastic.
“Not many passengers pay with their cellphones,” said Park Yong-sang, a taxi driver in Seoul whose car has the terminal that accepts payment by the mobile phone. “You won’t understand this until you start using it.”
Public transportation, convenience stores, Internet cafes, discount stores and online shopping malls accept credit cards or T-money by mobile. But most shops and restaurants do not, and banks and wireless companies are still squabbling over who should pay for the cost of installing the chip reader.
In 2008, 22.8 trillion won changed hands each day through Internet banking in South Korea. Of that amount, mobile handsets handled only 151 billion won, less than 1 percent, according to the Bank of Korea.
“We are still in a shift, educating the people in the convergence of banking and mobile technology,” Shim Gi-tae, of SK Telecom, said. “We are optimistic because using a mobile phone is much more convenient than getting your wallet out or going to an A.T.M.”
At Sookmyung Women’s University, one of the country’s growing number of schools boasting a “ubiquitous campus,” the mobile future has arrived. Students reserve seats in the library, check their grades and even pay for the washing machines in the dormitory with their mobile phones. The shift began in 2002, when the school authorities found that 98 out of every 100 students had mobile phones.
“They may come to school without their student ID cards but seldom without their phones,” said Jung Dong-hey, the university’s mobile technology administrator. “So why not use the mobile phone as a student card.”
For Kim Hee-young, her mobile is the Swiss Army knife of the digital era. When she wants ice cream, she just asks her phone, and it shows a list of ice cream shops — complete with their menus and customer reviews — and the shortest way to get there.
“During exams, professors ask us to turn off our cellphones, not just because of the noise but because we can search the Net for answers,” Ms. Kim said.