|Dave Park, CEO of Recobell, an ad-tech subsidiary of Yello Mobile, speaks during an interview with The Korea Times at Yello Mobile's head office in Sinsa-dong, Seoul, last week. / Courtesy of Yello Mobile|
By Jun Ji-hye
Dave Park, CEO of Recobell, an ad-tech subsidiary of Yello Mobile, believes that the value of blockchain technology will be appreciated only when it is used practically by people in their everyday lives.
Based on that belief, his firm and partners have considered ways of applying blockchain technology to the advertising market so that people involved in ad production and dealings can experience real innovation and convenience.
The result of their hard work has been the development of a blockchain platform called SIX Network.
The SIX Network uses smart contract technology as well as blockchain to create a more effective ecosystem for advertisement deals by, for example, offering simple contract and payment features.
The development and business team includes Futurestream Networks (FSN), a digital marketing subsidiary of Yello Mobile; GushCloud, a Singapore-based influencer marketing subsidiary of Yello Mobile; and Ookbee U, a Thailand-based content subsidiary of Chinese tech giant Tencent.
"We began the project based on the belief that blockchain technology could resolve various problems involving the current advertising market," Park said during an interview with The Korea Times. "First of all, the SIX Network can guarantee liquidity for the market."
In Korea, advertising agencies conventionally execute advertisements first, and advertisers pay fees two or three months later, Park explained. This time gap sometimes lays a burden on agencies as they need to pay out hundreds of millions of won first. This also sometimes causes unfair ad revenue sharing among multiple parties and inefficiency of liquidity in the market as well.
"The SIX Network can resolve those problems as it records advertising deals daily and shows achievement immediately," Park said. "This enables agencies and advertisers to calculate advertising expenses every day. We believe real-time payment will be possible ultimately."
The new platform will be useful especially at a time when the so-called "influencer marketing" strategy has been in the limelight, Park said.
Influencer marketing refers to requesting influential YouTubers or power bloggers to advertise certain products such as games, food or cosmetics.
Park said if a company wants 1,000 influencers to advertise its product, 1,000 contracts should be written in the current market. Managing different performances between influencers and handling their disputes is also an arduous task.
"We thought this problem could be resolved through smart contract technology as it can create contracts automatically and calculate advertisement costs based on each influencer's performance that is tracked by the platform," he said.
This can also reduce prime costs of advertisements as personnel expenses can be cut down, he said, noting that this will enable more influencers to participate in advertising.
As part of efforts to begin the business in earnest using the SIX Network, the team carried out an initial coin offering (ICO) of its own blockchain and cryptocurrency token, SIX, in May.
FSN said 520 million SIX tokens were sold through the ICO, noting that the token sale's soft cap of $15 million was also reached eight days after the public pre-sales began in April.
The team began to circulate SIX tokens to purchasers, June 6. The tokens can be used in real life through SIX Wallet that the team is currently developing.
"Our aim is to make it possible to buy content using our SIX token within the year," Park said. "That is the first test of the SIX Network. After we confirm that the token-based payment is working smoothly, we will continue to advance the platform."
The final goal of the team is enabling parties involving ad dealings to conduct their business using the SIX token, Park said, adding that when using the SIX Network, advertisers can reduce unnecessary costs, while profit distribution among those involving the advertisement process can be done more fairly.
"The blockchain technology will innovate the ad market as a whole," he said.
The service of the SIX Network will begin in Thailand first and then be expanded to other Southeast Asian countries, he said, adding that Yello Mobile has acquired companies in Thailand, Indonesia, Singapore and Vietnam through its subsidiary Yello Digital Marketing Global to expand its presence in the fast-growing Southeast Asian market.
"We will focus on the Southeast Asian and Korean market first," he said. "Then, if possible, we hope to expand the business to Japan."
In the long term, Park said the SIX Network could be used to evaluate the value of digital assets such as copyrights of video clips.
"The platform could evaluate standards such as the number of clicks and likes," he said. "Based on the precise assessment, we would be able to land our tokens to owners of such digital content."
Yello Mobile is the fastest-growing mobile media group here, with market observers often calling it a "dinosaur venture."
Amid the breakneck development of the Fourth Industrial Revolution technologies, Yello Mobile has been concentrating its efforts on conducting business using the blockchain tech.
As well as the advertisement area, the firm has also been focusing on applying the advanced technology to finance.
On May 11, the firm said its subsidiary, Daily Blockchain, set up a subsidiary, tentatively named Daily Crypto Investment Bank (IB), to push for the crypto IB business in earnest.
The crypto IB would work similar to existing investment banks such as mergers and acquisitions, investment consulting and asset management as well as issuing derivative products.
Daily Crypto IB will be jointly operated by Daily Blockchain and Formation Group, a venture capital firm based in Palo Alto with offices in Seoul and Singapore.
Brian Koo, a founding managing partner of Formation Group, currently serves as an executive director of the board of Daily Blockchain.
He is a grandson of LS Group's co-founder, Koo Tai-hwoi, who was also an honorary chairman of LS Cable & System. Because of his background, attention was high when he joined Yello Mobile's blockchain business.