|Seen above is a scene from “Alice Through the Looking Glass,” a 2016 U.S. fantasy adventure film based on Lewis Carroll’s novel of the same title. Helena Bonham Carter acted as the Red Queen, which has become a famous business term noting the necessity to keep moving forward so as not to fall behind. / Korea Times file|
Asia’s No. 4 economy struggles to compete with US, China
By Park Jae-hyuk
No matter how innovative a Korean firm is, it is rarely able to maintain the top spot in the global market, according to a chief executive of a domestic technology company. His company has provided local news outlets with articles written by a robot journalist over the past 10 years.
Although his company obtained a patent on the artificial intelligence-based technology in Korea in 2008, the businessman could not apply for an international patent, due to a lack of money.
Since then, foreign rivals have grown rapidly with mass investments. One of the competitors is Automated Insights, a U.S.-based technology company that has produced corporate earnings stories for the Associated Press since 2015.
“We are now unable to catch up with the fast-growing foreign companies,” the Korean entrepreneur said. “It is usual for domestic first movers to lag behind companies in China or the United States.”
The phenomenon is often called “The Red Queen effect.” Its name is derived from a statement that the Red Queen made to Alice in Lewis Carroll’s “Through the Looking-Glass” ― “Now, here, you see, it takes all the running you can do, to keep in the same place.”
In his thesis, “A New Evolutionary Law,” published in 1973, U.S. evolutionary biologist Leigh Van Valen coined the hypothesis that species have to run or evolve in order to stay in the same place or remain extant.
The hypothesis was applied to business administration in a thesis, “The Red Queen in Organizational Evolution,” published in 1996 by William Barnett and Morten Hansen at Stanford University.
Barnett and Hansen claimed companies that achieved successes in the market find it difficult to depend on their achievements, because latecomers can swiftly enter the market without trial-and-errors, learning from the first movers.
Many global enterprises have proved the argument.
General Electric, which first commercialized light bulbs 125 years ago, recently liquidated its light bulb business. Toshiba, which released the world’s first laptop, DynaBook, in 1989, is also pushing ahead with the disposal of its personal computer business.
Sony, which commercialized the lithium-ion battery in 1991 for the first time in the world, sold its battery business last year to Murata Manufacturing, a Japanese electronic component manufacturer. Intel, which invented the world’s first dynamic random-access memory (DRAM) in 1970, withdrew from the market in 1985.
Motorola, IBM and Toshiba, all of which once took the top spot in mobile phones, smartphones and flash memory respectively, have small market shares for now.
In Korea, SayClub and Cyworld pioneered the field of social media, but they collapsed after the emergence of U.S. social media platforms, such as Facebook and Twitter. Pandora TV also started video-sharing services earlier than YouTube to achieve success here, but eventually failed to make its presence felt in the global market against the global giants Facebook and Twitter. Currently, Pandora is struggling to stay afloat.
Korean conglomerates that have led global semiconductor, display, battery and electronics industries are not exceptions, as Chinese technology firms are rapidly chasing them. Korean companies have already yielded the top spot in the global liquid crystal display market to a Chinese firm.
Hyundai Motor is also struggling to come up with countermeasures against the growth of Chinese automakers. Based on their price competitiveness, Geely Automobile and Great Wall Motors are chasing the Korean carmaker in the world’s most populous country.