HeyAnita Korea, Inc. is a joint venture formed by Softbank, HeyAnita Inc., and local partnersin South Korea. Our venture empowers people to surf the Internet and access informationfrom any phone, anywhere, anytime simply by using their voice. HeyAnita’s patent-pendingAnitaServer technology provides a compelling advantage over our competition in numerousfactors, such as our voice-activated web agent and natural language processor. HeyAnitaKorea seeks to establish the first comprehensive Voice Internet Portal (“VIP”) in Korea andallow everyone with a telephone to access information (e.g. news, weather, stock quotes, andtravel information) and services (e.g. banking, shopping, stock trades, and games).Additionally, our company will build a base of corporate clients by enabling e-commerceproviders to add voice-applications services to their existing platform and allow traditionalcorporations to efficiently compete in the age of convergence.
Our Market Opportunity
Our market lies in the convergence of the plain old telephone, Internet, and wireless services.Our venture stands at the crossroads to capture market share and revenue from thetelecommunications, Internet, and wireless arenas. South Korea is an ideal target market for HeyAnita due to four key market conditions:
One of the fastest growing Internet markets in the world
From 1998 to 1999, Internet users grew from 3.1 million to 10.9 million users. Over thecourse of six years, the CAGR (compound annual growth rate) was 239%. E-commercegrew from 672 billion won (US$605 million) in 1999 to 1.5 trillion won (US$1.4 billion) in2000. This places Korea among the top 5 Internet markets in the world.
Over 50% wireless telephone penetration
As of April 2000, South Korea has over 27 million wireless phone users. From 1997 to2000, the CAGR for wireless phone use was 400%. This large wireless market addssignificant additional value to the near 100% of landline telephony.
Significant demand for information “over-the-phone”
As illustrated by the growth in the 700 ARS industry and Wireless Application Protocol(WAP) services, Koreans are embracing mobile information. In 1999 alone, the 700 ARSproviders generated some 100 billion won from a user base of 3 million people by offeringover-the-telephone services related to stocks, weather, traffic, and entertainment relatedinformation (NOT including pornography). During the past 3 years, growth in this markethas accelerated to a rate of about 30% per annum.
In addition, with Korea’s 5 wireless carriers having recently launched WAP services toprovide information similar to the 700 ARS players, more than 3 million people profess tohaving tried WAP services (about 10% of all wireless users). Despite user complaintsabout difficult and clumsy interface, market research indicates a continuing desire toaccess the types of information offered.
Large segment of early adopters in technology
As with other Asian countries, Korean consumers are fast adopters of technology andgeneral trends within its society. The rapid growth in the wireless and Internet marketssupport this premise, but a better example is the incredible growth of online stock tradingin Korea. Within four months of its availability, over 40% of total trading volume was doneonline. We assume our technology and service will have a similar impact.
Based on interviews with managers of multiple currently operating 700 ARS services. The informationwas crosschecked through discussions with managers at Korea Telecom who confirmed the magnitudeof these numbers.
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