The Current Status of Telematics in Korea

1. The Current Status of Telematics in Korea 2005. 6. 06 KOTBA Stacy Kang

2. Providing ‘Multimedia Service for Vehicle’ such as traffic information, emergency rescue, safety driving, entertainment to drivers and passengers Profile of Telematics Definition Building mutual cooperation system by specializing their own characteristics System Overview Relation with Other Industries GPS Satellite -Receiving vehicle’s location Travel/ Transportation Telematics Wireless Internet Making car as the 3rd digital life space (Offering customized high quality information and real-time service) V-Shop Wireless Mobile Communication ITS GIS Leisure Ensuring efficiency of traffic operation by intelligent transportation system and improving traffic safety & environment Utilizing various geographical information combining factor data relating to it Telematics Terminal Weather Telematics Center Entertainment Deliver all the services to driver by telematics terminal with wireless mobile communication IT Basis Traffic Information (Driver) Infotainment (Passenger) Automotive Management Introduction to Telematics Service • Shortcut Information • Real Time Traffic Information • POI • Various Multimedia Services • Game, e-mail, VOD, Music services etc. • Remote Diagnosis • Emergency Rescue • Prevention Vehicle Stealing

3. Strategies by Telematics Business Cluster Telecom. Operator • Convergent service of different industries • Achieving early vitalizing and successful development of telematics industry thru business alliance Content Provider AutomotiveOEM Associated Business (Insurance, Logistics etc.) SI

4. Strategies by Telematics Business Cluster Top 5 Strategies by Telematics Business Cluster for Market Share ※참조: Gartner G2, Q3 2003

5. Service Classification by Telematics Terminals Safety & Security Base Integrated Mobile Phone Navigation Base • Embedded Type • Voice Based Service • Early Stage Model • Mobile Phone Added on Type • TbT Navigation • Specialized in Navigation • Telematics Function via Communication Module Interface • Automobile Embedded Type • Relatively High Price Samsung Fire&Marine Insurance(Anynet) Nate Drive, K-ways ez-Drive Some Venture Companies MOZEN, Everway • Safety & Security Fuction • Remote Vehicle Control • Stolen Vehicle Tracking • Hands-free, Voice Communication SVC • Messaging, E-mail Fuction • Navigation function like searching shortcut, direction and etc. • (Safety & security function can be added to high-end car) Main Service Type • Combination type with vehicle internal systems • Able to communicate with vehicle which TCH is installed • Mobile phone, PDA • Stand-alone is prevalent • High resolution display • Able to use driver’s mobile phone Target Market Before Market After Market After Market Before Market

6. Telematics in Korea Characteristics of Telematics Service in Korea • Business leader : Mainly serviced by Mobile communication operator+ Automotive manufacturer • Major service: Traffic information, Navigation (For automotive and personal) • Market characteristics : Highly focused on certain area (Metropolis including Seoul and Busan) • Strength : World’s best wireless communication infrastructure, Consumer’s inclinations for Early Adapter, superb contents developing capability • Weakness : Low graded technology of automotive parts, Lack of international negotiation ability for platform standardization • Key service name : NateDribe(SKT), Mozen(Hyundai), K-Ways(KTF) , Subscribers : approx. 275 thousand

7. Telematics is evolving from driver focused service to comprehensively integrating circumstance searching, driving habit, and vehicle transportation. View on Telematics Service VRM Safe driving Real time dynamic shortcut notification Remote diagnosis On-demandentertainment Voice E-mail, SMS Internet service(E-mail, Web) Stolen vehicle tracking View on Telematics Service Technical Level Wireless internet, DMB,WCDMA, ALL IP High Auto driving Two-way traffic information 3G wireless communication network,WLAN+2G/3GWLAN+VoIP V-Commerce Safe driving • Various value added service • Systemically growing by government • Need of core technology Simple shortcut notification POI Search Emergency Rescue Simple traffic information using text and voice 2G wireless communication network, WLAN LOW 2003 2004 2005 2006 2007

8. Bottlenecks and Improvements in Telematics Bottlenecks Improvements • Inefficient nation wide traffic information integration and providing systems • Hard to access public information because of no guideline for information opening • Lack of compatibility due to absence of standardization of traffic information and electronic map between players • Early activating of TELIC -Single channel providing of dispersed traffic information • -Preventing duplicated investment by TSP • Make de facto standard in the light of demand side Traffic information gathering and standardization Market side • Low awareness on telematics • Hard to experience what is telematics • High mobile communication using fee (esp. data contents), registry fee, and terminal price • Lots of gap between customer’s expectation and service qualtiy • Preparation of PR material (book, picture etc.) • Presenting good contents by improving material flowing structure (TELIC) • Lack of source technology development • Difficult to realize interface between car and human • Low technology level of voice recognition • Developing systemic technology by constructing cluster for areas having specified technology • Linked R&D by Industry, academy, and research institution (Studying every technology by ETRI) Technology side Policy side • Any marketing activities of safe driving industry players banned due to government restriction • Need of systemic support for telematics growth • Need of law institution policy support for early vitalizing telematics market - limited permission for subsidy of terminal • - Adjustment fee system (Civil initiated) - Make user protection system

9. Business name : Telematics Information Center (TELIC) Construction • Duration : Jan. 2004 ~ Dec. 2007 • Business period in this year : Jan. 2005 ~ Dec. 2005 Activities in Korea [TELIC] TELIC Overview TSP 1 Integrated public traffic information(NITIC of MOCT*, KOTIC of NPA** Self-selfgovernment etc.) Traffic(Civil,Public) NavigationMAP Weather TSP 2 Information ... Civil traffic information PublicPOI Traffic information TSP N TELIC Real telecom ROTIS Relating business Disater112/119 Building RS dissemination system KTF SK Corp. TMS DB(Professional,Technician) B2B linking Logistics Insurance Other information Security Weather MAP Telelmatics information processing system Disaster POI Telematics information linking system Information Service center at telematics pilot city Parking lot Tel. # Telematics information foundation system *MOCT : Ministry of Construction and Transportation **NPA : National Police Agency

10. Activities in Korea [Je-Ju Island Pilot City Project] Telematics Service Center CDMA 1x (EvDO) Telematics service (text etc.) CDMA station Telematics terminal A 코스 B 코스 C 코스 Je-Ju Island Pilot Project Overview Vehicle control Emergency call Travel/Traffic (Shortcut information) Travel/Traffic (Traffic information) Je-Ju 119 Emergent going out order Travel/Traffic(Sightseeing) Travel/Traffic (Accommodation) Vehicle and emergency call control Emergency rescue (linking with 119) Je-Ju Already made contents Trave/Traffic Cultural event V-Shop (Local specialty) Je-Ju culture Cyber Je-Ju (http://cyber.jeju.go.kr) E Je-Ju Mall (http://www.ejeju.net) Cyber Samdaguan V-Shop GPS satellinte Emergency rescue (vehicle location information) Leisure (Climbing) Leisure (Weather) Leisure Contents provider Weather Climbing, Golf, Fishing, Karaoke, Game, MP3, Stock trading, Weather Leisure (Golf) Entertainment (Game) Entertainment $ Je-Ju ITS Center Entertainment (Stock trading) Entertainment (Karaoke) $ $ Wireless LAN WLAN AP Telematics service (multimedia contents etc.) $ : charged

11. Activities in Korea [Others] • Promote Domestic Telematics Industry • Spur domestic telematics markets through government-led legal and applicative supports with a view to induce a practical domestic standard. • KOTBA offers the directions for strategic alliances and cooperative relationships between business parties. • Telematics Standardization Forum • Telematics Standardization Forum move forward de factor with existing commercial technology • According to enact telematics standard, telematics companies reduce duplicated cost, increasing efficiency. • Public Pilot project (FMS: Fleet Management System) • Using telematics technology, companies arrange and manage their automotives such as bus, truck, ambulance and rent car. • Propose Business Model of Broadcasting-Communication

12. Activities in Overseas [APEC] • APEC Telematics Promotion Strategy • Survey on the current telematics status (legal, policy, infrastructure, etc on each • economy) • Verify Telematics issues (Privacy policy, security, safe driving, and etc) • Suggest initiatives for telematics market activation on APEC region Korea Japan HKG(China) Taiwan Singapore Australia

13. Some Telematics Policy Issues • Each APEC Economies promote industry with different policies • Necessary to initiate Win-Win strategy for all APEC Economies • Different regulation and legal restriction issues • Safety : • Emergency call • Reduce injuries on natural disaster such as Tsunami • Privacy • Security • Technological gap

14. Propose to have a next APSC Meeting in Korea KOTBA would like to propose to have a next APSC Meeting in Korea And provide a chance to experience the status of and movement of Telematics market in Korea. Date: September or October or December Place: September (Seoul), October(Busan),December (JeJu Island)

15. Q&A • KOTBA : Korea Telematics Business Association • Stacy Kang, Manager • Tel: +82-2-2285-1650 • E-mail: stacy@kotba.org