[plug] M$ and software donations, a flashback to Korea

[Leon Brooks]

The page this is on 
(http://gnu.org.in/pipermail/fsf-india/2001-August/001702.html) appears to 
not have a server at the moment, this is from Google's cache, <quote>

Free Software in Korea: Part One -- The Microsoft Connection
(Oct 4th [2000?], 06:05:46 )

By Randy Leganza, Special Korea Correspondent for Linux Today

When Dwight Johnson of Linux Today asked in late July if I'd consider a
doing an article on Linux in Korea, I had no idea the amount of time or
the countless e-mails it would require. Even though there had been several
recent stories in the Korean English press and the government's announced
support for Linux in July, I grossly underestimated the "Linux in Korea"
story.

When the Korean government's Ministry of Information and Communication
announced in late July that it would "provide government support for the
development and proliferation of Linux," it was not only one of the first
official endorsements by a national government of the free operating
system but one of the largest defeats ever for Microsoft.

To appreciate the Microsoft connection to the Korean government's
embracing Linux requires relating events extending over two years. In the
end, despite its best efforts, Microsoft Korea would not only fail to
dominate the local word processor market it had targeted, it would suspend
its "campus license" program and see its president suddenly resign.

These days hardly a week goes by without Microsoft's local ventures being
mentioned in the English language Korean dailies. But Microsoft's interest
in Korea extends back at least 15 years with a partnership agreement in
1984 and a branch office opening in 1992. Over the years, Microsoft
developed relationships with numerous Korean companies.

Bill Gates has traveled to Korea several times. In 1994 Gates traveled to
Korea to sign a source code licensing agreement with the Korea Advanced
Institute of Science and Technology (KAIST). Then in June 1997 he traveled
to Korea again to address the CIO Forum, a support group for Korea's CIOs
organized by the Federation of Korean Information Industries.

Microsoft's trouble with the Korean government first began to surface in
October 1997 when the Korean Fair Trade Commission announced an
investigation into Microsoft's business practices. This investigation
mirrored that of the U.S. Department of Justice. (No resolution of this
investigation has yet been seen in the local English language press.)

While Korea was struggling in May 1998 to recover from its worst financial
crisis in history, Steve Ballmer, then a Microsoft vice president,
announced a $77 million software donation to Korean schools and
institutions.

Although Microsoft's gift was graciously accepted, some thought it mostly
an attempt to get Korean students on the Microsoft gravy train. When
queried at the time about making an investment comparable to those made by
Hewlett-Packard and Intel, Ballmer reportedly said, "We think that an
investment in knowledge is more important than any factory." Little did
Korea know then what was up Ballmer's sleeve, nor did Ballmer then suspect
that Microsoft would end up with egg on its face.

At the time of Ballmer's announcement, the maker of the country's only
indigenous word processor, Hangul and Computer Company (H & C), was nearly
bankrupt because of the bootleg software market for its product, Hangul.
Microsoft negotiated a bailout plan for the ailing company -- in exchange
for a Microsoft investment, H & C announced it would cease development of
the Hangul word processor and end support for it a year later.

Only a month after Ballmer's announcement of the software gift, the deal
was scheduled to be closed when, according to the plan, Bill Gates would
fly in for a two day promotional tour.

But as soon as it was announced, there was an immediate public outcry and
the deal ran afoul of both the Korean populace and the Korean Fair Trade
Commission. Suddenly Koreans saw Microsoft's offer for what it was -- an
attempt to monopolize the local word processor market. They took it as an
assault on their national pride, a sort of "cultural colonization".

The Koreans had more than just their ire for Microsoft's business tactics
on their side. The indigenous Hangul word processor could correctly
display more than 11,000 combinations of the Korean language's phonetic
characters, as contrasted with Microsoft Word's 2,500. And the Korean word
processor could display western fonts as well.

Bill Gates still flew in but left empty handed after a meeting with the
Korean President.

A grass roots fund raising campaign quickly began to revive H & C. The
Korean Venture Business Association (KVBA) offered $7.3 million to save
the company. Approximately two thirds of the investment would come from
association members, and the remaining one third would come from
contributions by Korean individuals. The company accepted the KVBA offer,
wisely created a limited license version with a slashed price to encourage
paying customers and called for the Korean government, itself a flagrant
violator, to began a campaign against bootleg software.

H & C survived and in September 1998 announced its plan to raise $7.3
million dollars in a public stock offering.

Facing mounting opposition, but not to be out done, Microsoft continued
with its aggressive drive to inundate Korean educational institutions with
artificially cheap software. In August 1998, Microsoft released a Korean
version of Windows 98 to an eager, but often disappointed, public and
reported 27,000 copies sold within only the first four days, a figure
comparable to Windows 95's sales.

Although Microsoft had not been able to buy out its chief word processing
Korean competitor, its marketing machine was undaunted. It vowed to
improve the Korean Microsoft Word's ability to display the older Korean
characters and began to hype its Korean Microsoft Word 2000 in January
1999.

But Microsoft made a disastrous marketing miscalculation. While the
schools and universities were getting bargain basement discounts to entice
students onto the Microsoft gravy train, individual software buyers were
still paying full price.

In early 1999, local software resellers, squeezed mercilessly from both
sides, denounced Microsoft's pricing strategy. The Korean retail
marketplace is still mostly a mom and pop operation. These small chains
and individual stores could not turn enough volume to warrant the large
discounts that retail giants and OEMs obtain. In addition, these resellers
were the target of a crackdown on bootleg software. They objected to
Microsoft's alleged entrapment of bootleg resellers, a charge denied by
Microsoft. The resellers went so far as to hold a rally to protest
Microsoft's pricing policy.

Then in mid May, the Korea Times published the results of a survey which
reported that "87.2 percent said the Windows operating system is
``unsatisfactory'' but that they have no choice but to use it."

The May 1999 resellers anti-Microsoft protest was accented when Hangul and
Computer charged that Microsoft was "dumping," selling its wares at 10% of
its market price.

To this accusation, Microsoft responded (according to the Korea Herald),
"We introduced the site license program, in which we sell our software
package at cheap prices, to the Korean market to help spread the use of
genuine software products among students." Microsoft also countered that H
& C was guilty of its own accusations because they had slashed their price
to less than $10 for their one year license version. The government said
it would investigate.

Microsoft finally relented and withdrew its "campus license" policy
pending a final decision by the Korean government. Microsoft Korea had now
suffered its second setback in its drive to dominate the Korean word
processor market.

Amidst all this negative attention, in June 1999, Microsoft released its
Korean Microsoft Office 2000. As an answer to H & C's discounted one year
license version of Hangul, Microsoft offered the Korean Microsoft Word
2000 with an annual subscription option of under $10. A Korea Herald
article claimed it could now process 11,172 Korean syllables, 1.6 million
old Korean characters and 27,000 Chinese characters.

Meanwhile, the Korean government continued its crackdown on bootleg
software. Even though government agencies were as guilty as everyone else,
the crackdown on bootleg software was hurting Korea's schools far more
than the government. Many schools were forced to suspend computer classes
because they could not afford the software license fees.

The Korean government was under pressure from all sides. Consumers and
resellers complained that Microsoft's products were too expensive and that
there was no alternative to Windows. The software industry wanted its
license fees -- yet this unbudgeted expense was a monstrous burden on both
small business and the educational system. Koreans wanted Hangul and
Computer to survive -- yet they didn't want to appear anti-Microsoft and
alienate another foreign business when their economy badly needed foreign
investment.

The logical alternative seemed to be software without burdensome license
fees -- enter Linux!

In July 1999, the very same day the Korean Ministry of Information and
Communication announced it had formed a group to discuss support for
Linux, the JoongAng Ilbo reported Microsoft Korea's President Kim Jae-min
had abruptly resigned. Microsoft said the resignation was voluntary but
some believed that he was held responsible for Microsoft Korea's failures
over the past year. The government soon confirmed its support for Linux
saying it would promote its use in public organizations.

Ironically, hard on the heals of this announcement came the release of a
Federation of Korean Industries' survey picking Microsoft as the number
one business role model, followed by General Electric and Ford.

Was it merely a coincidence that Microsoft Korea's president resigned at
the same time the government announced its interest in Linux? No one is
saying. Regardless of the government's motivation for supporting Linux,
the support is there. Linux and Free Software in Korea is on the move.

-----------------------------------

Free Software in Korea: Part Two -- The Linux Side (Conclusion) Oct 10,
1999, 07:15 UTC

By Randy Leganza, Special Korea Correspondent for Linux Today

Korean Government Support for Linux

A most promising development for the free software movement in Korea is
the government's Ministry of Information and Communication announcement in
late July that it will "provide government support for the development and
proliferation of Linux." The Korea Herald, among others, reported that the
ministry "will establish a Linux consultative body composed of software
experts from the government, academic and industry sectors to standardize
Korean versions of Linux and develop a variety of programs based on the
operating system."

At the forefront of the Korean government's support for Linux is the
Electronics and Telecommunications Research Institute (ETRI). According to
Kim Hae-jin (family names are first in Korean), who is heading the ETRI
Linux project, ETRI's plan is to "provide a highly scalable, highly
available, single system server image cluster [technology]... adaptable
from Internet [servers] to [the] mission critical enterprise."

A non-profit organization called the "Linux Council" has been established.
Four committees within the Council have been designated:

1. Standardization -- standardize Linux's Hangul terminology and
documentation.

2. R & D -- promote research in and development of Linux software.

3. Supply and Support -- support Linux in end-user markets, schools and
government offices.

4. Education and Training -- promote Linux education and training.

Kim adds that they will also sponsor more Linux forums like a recent one
held in July 1999, which was attended by Linux International's John
"maddog" Hall.

A Long History of Free Software Use

Korea has been involved with the free software movement for over twelve
years. An obscure reference on the GNU web site reveals that in April of
1987, Richard Stallman visited the Korea Advanced Institute of Science and
Technology (KAIST) in Taejon.

More recently, in May of this year, Tim Ney of the Free Software
Foundation visited Korea with a Massachusetts Software Delegation and "met
with a number of young software start-up companies..." According to Tim,
"many of the companies [he] saw were predominantly writing software for
the Windows platform, yet responded quite positively when [he] spoke about
free software and opportunities with GNU/Linux."

Free Software Projects

Ongoing free software projects in Korea include:

* Hanterm 3.1 from the KAIST, a Korean language (Hangul) xterm

* OpenHWP, reported to be an almost defunct Korean free word-processor

* And a team of at least four package maintainers contribute to the Korean
Debian Project. The Korean Debian project has members from both the
academic and business communities. Park Chu-yeon, current leader of the
project, is working on the Korean Debian Bible with other project members.
They maintain nearly 50 Korean Debian packages.

Linux is not the only project associated with the free software movement
in Korea. FreeBSD also has a following. Choi Jun-ho is the leader of both
the Korea FreeBSD Users Group and the GNU Free Translation Project. Choi
reports that he first used GNU/Linux in 1993, then moved to FreeBSD in
1995.

Korean Companies That Market Linux Products

WebDataBank

Choi is developing a unique Linux distribution, qLinux, at his company,
WebDataBank. According to Choi Jun-ho, qLinux will be bootable from a
large ext2 file image on an existing Windows FAT partition via a loop-back
device. He says qLinux will also be able to "utilize" the Windows Registry
to configure X Windows, network cards, etc. WebDataBank is in the Linux
Internet server hosting and groupware development business. They will soon
release a Korean version of TurboLinux 4.0.

MIZI Research

Another Korean company, MIZI Research markets MiziOS, its own Linux
version and HWPX-R4, a Linux/Unix Hangul word processor that is a close
cousin to Hangul and Computers (H & C) Hangul Windows version (Hangul
means the "Korean written language"). MIZI's head, Seo Young-jin, was the
UNIX HWPX-R4 team leader at H & C before H & C decided to drop the UNIX
version in 1997 and focus on their Windows version. Seo then licensed
HWPX-R4's source code and started MIZI.

Microsoft's subsequent failed attempt to shut the H & C Hangul word
processor out of the Korean market was a pivotal event in the rise of free
software in Korea. See Free Software in Korea: Part One -- The Microsoft
Connection.

HWPX-R4 is included on the MiziOS CDs, as either a demo version or an
official bundle.

MIZI also supports the Free Software movement with:

* ManIM, which enables Hangul fonts in Netscape on X

* a Hangul font server

* some document viewers that will soon fall under the GPL

* four Korean TrueType fonts under the BSD license

MIZI's decision whether to publish under the GPL or a commercial license
is level-of-effort based. According to Seo Young-jin, "Some software is
attractive and fun and others [requires] endless maintenance. The latter
[we license] commercial."

Under commercial licensing, MIZI is currently working on an architectural
CAD application that will be available in Hangul and English. Seo said
that he hoped to "shareware" the English version, explaining that part of
the code was licensed from another company and MIZI needed to recover the
cost.

Zion Systems

Zion Systems develops Accel, a Korean distribution based on Red Hat. In
developing Accel, Zion Systems uses the latest kernel version and
libraries, builds their packages optimized for Pentiums and is working on
a Korean GUI installation package.

In partnership with Samsung, Zion Systems markets a line of high
availability Alpha and Xeon SMP servers that can support clustering and
further plans to market a sub $1,000 Linux PC in October. Currently Zion
is working on GPLing their audio drivers and high availability management
software.

Zion is also setting up an "after service" center for its product line.

3R Soft

3R Soft produces MailStudio, a Linux/Unix Web-based e-mail server.
MailStudio's user interface runs inside the Web browser, like Netscape and
Yahoo's mail servers. MailStudio is compatible with Sendmail, SMTP, POP,
and qPopper. In their upcoming 3.0 version, 3R Soft plans to offer IMAP,
LDAP, and spell checking support. While 3R Soft does not produce any GPL
software, they are compatible with Red Hat, Caldera, TurboLinux and
Apache.

Other Korean Linux Companies

At least three other Korean companies produce seperate Korean versions of
Linux:

* Linux Korea markets the Power Linux distribution and the Netspirit 2000
and 3000 Linux-based servers.

* Korea Linux sells the Alzaa Korean version of Red Hat.

* ClassData offers the Class 6.0 Enterprise Linux distribution, which has
an interesting glass bottle logo and the catchy slogan, "stop paying your
Bills."

In addition, Informix Korea has a series of Korean pages devoted to Linux,
including links to downloads.

Linux Use Growing Rapidly According to Denis Havlik:

"I have been witnessing an enormous growth of "registered Linux users" in
Korea for quite some time. (Take a look at "the Linux Counter", under
"Denis Havlik's report"...) The growth is not so dramatic any more, but
still rather fast: 156% annually."

"Registered users" probably account for less than 1% of the Linux user
base(*) -- currently there are more than 3,000 registered users.
Therefore, my estimate is "more than 300,000 Linux users in South Korea"
today. Greater than 500,000 would not surprise me, either."

The Fight for the Linux Trademark

Sadly, all the positive news about Linux in Korea is not without its
controversy. The last week of August, a fight broke out over the Linux
trademark, when a lawyer for Kwon Yong-tae, who holds a Korean trademark
for 'Linux', demanded that the Kyobo Books bookstore stop selling books
with Linux in the title. Three days later, the incident became a hot topic
on Korea's popular Linux bulletin board and it made the English Linux news
sites the following weekend.

Allegedly, the trademark was applied for in 1995 and granted in 1997.
Korean publishers, business and other interested parties are still working
to resolve the issue. For those interested, Lee Kyong-ho is maintaining an
event time line at the bottom of his Web page on the problem, with a link
to an English version of a petition.

---------

Randy lives in Taegu, Korea and is on his third, most fun and least
stressful career. He's the QA/Test guy on a small team supporting a large
Solaris WAN integration project, with a few Linux boxes scattered about.
He gets to play with computers all day and intentionally break them --
then complain about it, and usually see things get fixed. When he can, he
likes to fly airplanes, lift weights, hunt and fish.
</quote>

Cheers; Leon