http://www.economist.com/node/21547295
Some North Koreans get better connected
A NORTH KOREAN professor apparently posted footage on YouTube last year boasting that his country was developing applications for the Android mobile-phone operating system. Ordinary North Koreans are more likely to be pining for a humble mobile phone of any sort, and now their chances of owning one are increasing. Smuggled mobiles have been used on Chinese networks near the border for years, but now business is booming for Koryolink, the North’s only official cellular network, based in the capital, Pyongyang.
The service—75%-owned by Orascom, an Egyptian firm, and 25%-owned by the North Korean state—has gone from 300,000 to 1m subscribers in 18 months. For a hermit kingdom whose rulers resent their subjects keeping closely in touch with each other, this is a remarkable development.
Koryolink earns a gross margin of 80%, making North Korea by far the most profitable market in which Orascom operates. The company has worked hard to court the regime, its chairman travelling to Pyongyang last year to meet the late supreme leader, Kim Jong Il.
North Korean mobile-phone users spend an average of $13.90 a month on calls and text messages, and they tend to pay in hard currency. According to a foreign diplomat, many customers turn up at Koryolink shops with bundles of euro notes. There are even incentives for paying in euros, such as free off-peak calls. This provides foreign currency for a government that craves it.
Mobile-phone customers obtain the hard currency from the informal private trading on which many North Koreans depend. Such business is forbidden, but the government has failed to feed its people, forcing it to turn a blind eye to some capitalist practices. Many insiders benefit: Pyongyang’s “golden couples” consist of a government-official husband and an entrepreneur wife.
Mobile usage now appears to be spreading beyond Pyongyang. The gadgets are a common sight in other cities such as Nampo, not far from the capital, and increasingly are owned by non-officials. As yet, though, only a sixth of the country has a mobile signal.
The authorities are not naive. Some outside observers believe that North Korea’s first experiment with mobile telephony came to a sudden end in 2004 because a mobile phone was used to detonate a huge bomb at a train station that nearly killed Kim Jong Il.
Koryolink is a walled garden: users are not able to make or receive international calls, and there is no internet access. It would be hard to imagine that calls and text messages are not monitored. As in China, the network is even becoming a means by which the state disseminates propaganda. Rodong Shinmun, the government mouthpiece, sends out text messages that relay the latest news to phone subscribers.
Orascom’s slogan is “Giving the world a voice”. For Koryolink’s users, that may literally be true, as North Korean mobile-phone users enjoy some of the benefits of modernity that other countries take for granted. Their phones are not yet the tools of revolution, but mark an amazing change for all that. ◦
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