Gloomy Grand Prize Winner

"What`s the point in getting the grand prize in the Korea Patent Exhibition? The market share has nothing to do with it. The prize gets us nothing. It`s rather kind of embarrassing," said, with a sigh, one employee of MPMan.com, Inc. The company, a manufacturer of MP3 players, is scheduled to win the Korea Patent Exhibition offered by the Korean Intellectual Property Office.

In 1997, the company invented the MP3 player (photo) for the first time in the world, marking Korea as the origin of the player. Just to develop it, the company had to our in its resources for one year. Due to the achievement, the company will receive the President`s Award, a grand prize in the Patent Exhibition. Nonetheless, the news does not make the employees happy. Above all, the market has not shown a positive response to the company.

The market for MP3 players amounts to \30 billion (approximately, $2.5 billion) a year. Even though MPMan.com developed the player first, Samsung electronics dominates the market with its Yepp series that occupy more than 40%. Moreover, other companies like Difital Way, Inc. have put MPMan.com behind. Now, MPMan barely occupies 10% of the total market. Furthermore, its brand perception is hitting almost at the bottom. In a survey recently conducted by an online shopping mall, the company did not make any entry.

What exhausted the company more was the lawsuit it filed against 50 other MP3 manufacturers for the patent violation. The lawsuit lasted for one and a half years and finally settled, after consuming huge amount of time and money of the company. In return, it has acquired not only a \30 royalty (or less than a cent) per each unit they produce, but also lots of enemies in the industry.

With the management getting worse, the company has decided to move out of its current office in the ASEM Tower in Samsung Dong, and to move into another office next February in Gooroh Dong, Seoul.

MPMan.com complains, "We did all the hard works. But the fruit has gone to other competitors." In addition, it points out as another reason for its failure the marketing strategies of the big conglomerates, pushing it into the corner with their huge pool of resources and advertising power. Lately, the company made up its mind to start over again, forgetting all the privileges and pride of the first developer. Now, it is trying to tab on the overseas markets. Acknowledging its failure in designing, promotions and marketing, it is pitching in its efforts to develop new products. It has also opened itself to the criticism that it should look back on the arrogance in neglecting the marketing part, possessed with the pride of being the first developer.

Jung-Eun Lee lightee@donga.com