DECODED X is more than just news.
It’s a weekly brief of critical political and economic events in Korea and their takeaway, created by The Investor staff for an exclusive group of opinion leaders.
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In the meantime, enjoy the highlights of the Sept. 29 issue of DECODED X.
It’s the longest holiday to date. This year’s Chuseok is 10 days long, including the weekends.
It’s a shame we can’t all be in a celebratory mode, what with North Korea up to its antics and relations with China still in freeze mode.
The economy isn’t doing all that bad, but the North is definitely casting a big, dark shadow on even the good things, and crimping President Moon Jae-in’s style.
Speaking of Moon, the government isn’t helping with the mood with the Ghosts of Christmas Past going on–dragging up all past faults in the name of undoing the wrongs.
But at least for now, let’s try to make peace, shall we. Here’s hoping for Pyongyang to stay put. Read on for this week’s DECODED X.
IT’S A CAR, IT’S A CHAIR, IT’S…BODYFRIEND
Bodyfriend is striving to become the equivalent to “Starbucks” in the world of massage chairs. The firm is currently doing a deal with Lamborghini, yet another household name in the world of fast and furious sports cars.
The new chair will be unveiled early next year, and Bodyfriend told The Investor the launching will be in the US, and not Korea.
Bodyfriend expects the Lamborghini version to become a turning point for the 10-year-old firm, and is working on not just applying the Lamborghini design, but also technology, such as headlights and the sound of revving engines.
Having hit the 10th-year milestone this year, Bodyfriend is expanding into China and the US. In China, it already operates stores, but sales have been less than stellar.
Talks about an IPO are also on the table, although the firm denies it would be any time soon.
Korean private equity fund VIG Partners acquired Bodyfriend through a consortium in 2015 for 300 billion won (US$261.37million). Net profit since then jumped from 18billion won to 78 billion won. VIG Partners is now looking to exit, possibly through Chinese funds, but things have been put on hold due to the THAAD row between Seoul and Beijing.
FIELD DAY FOR US FORCES
Credit rating agencies, think tanks and experts alike say the current situation on the Korean peninsula is still nowhere near a real war, although the government has said it would be on alert during the Chuseok holidays for a “surprise attack.”
Despite such caution, there are still fears, and the public is taking the situation in their own hands, in a way.
USFK individuals are being flooded with questions about whether they have been informed of a possible evacuation, accompanied by pleas to let them know if and when they do get such information.
USFK forces are keeping mum on the issue, but have said, with precaution, that there is some level of heightened vigilance.
Legalized lending and borrowing between individuals are forming a new market in South Korea, and JB Bank of JB Financial Group has become the first local bank to form a partnership with People Fund.
People Fund is the only P2P firm in Korea that extends loans to individuals by pooling funds in a bank –in this case, JB Bank.
Meanwhile, JBBank, which has been looking to shake off its provincial image (JB stands for Jeonbuk, or North Jeolla Province), what with a new Harvard-grad captain at the helm, may just do that.
A BUMPY RIDE
Woowa Brothers, known for its operation of highly successful delivery app Baedal Minjok and for getting investment from corporate big wigs such as Goldman Sachs and Stonebridge Capital, is in for a bumpy ride.
Despite claims from the company that ad fees they collect from restaurants are not unreasonably high (they recently revealed just how much their top clients pay), and that the benefits they reap outpace the costs, restauranteurs are complaining.
They say the ad fees are too high, despite that Baedal Minjok has actually eliminated other commissions altogether. Right now, there actually eliminated other commissions altogether. Right now, there are no laws to regulate the business.
Woowa Brothers was founded by Kim Bong-jin, who has become a legendary figure in the industry. He’s a representatives for Korean startups, and recently, he urged the government to deregulate on startups, saying that the red tape is getting in the way of innovation.
According to Kim, almost half of Korean startups that started off globally wouldn’t have made it if they tried it in Korea.
The South Korean government created a new ministry this year to handle SMEs, but what with the fiasco over a failed minister appointment, it looks like it will be a while before things take off.
WHY COPYRIGHT MATTERS
Strictly speaking, this isn’t business news, but it does shed light on how underestimated or overstated the royalty fee business is.
Kim Gwang-seok is a well-known Korean celebrity who is cited as the King of Korean folk music. At the age of 32, he committed suicide, leaving behind a wife and daughter. His death was deeply mourned, and to this day, his songs are favorites at karaokes.
And of course every time someone sings his songs, somebody collects -- his wife, who inherited everything. Turns out that Kim’s wife made up to 2 billion won from royalties only, and has been living quite comfortably, which apparently, may be a sin.
Investigators have reopened the case, starting with the death of Kim’s daughter some years ago. This began after a reporter alleged that Kim’s death was a homicide.
Now, legal sources are saying that the law may not side with Kim’s wife, mainly for failing to notify the courts when she got into a legal battle with Kim’s family over record rights that their daughter is dead. This is because their daughter made it easier for Kim’s wife to win the case.
Just how valuable copyright is was highlighted with the news. At the same time, there’s a barrage of criticism that it’s nothing but a witch hunt, and involving a woman who lost both her husband and her child.
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