[Sisajournal-e= Reporter Kim Yong-su] On the 21st, Lee Hee-Seung, CEO of Union Mobile, said, "Telecommunication companies receive 300-400 business proposals a year. Companies pitch to telecoms because they have a subscriber base. Isn’t that the role Naver and Kakao are playing now?” He added, “We decided it would be beneficial to assume a similar role in a smaller but opportunity-rich market like Cambodia.” Born in 1970, CEO Lee joined the LG Group in 1996 and worked on multimedia engine design and development at LG Media, system design engineering at LG Soft (the predecessor to LGCNS), and held various positions related to internet communication and mobile service projects at LG Telecom (now LG Uplus) until 2008. In 2017, he joined Union Mobile as a founding member. Union Mobile is an ICT service specialist company involved in system integration (SI), Internet of Things (IoT), cloud services, and more, with the global market as its primary focus. Leveraging engineering technology and communication services, they entered the Cambodian market in 2020. They collaborated with Cambodia's Ministry of Information and Communications Technology and mobile operator Cellcard on telecommunications, information security, and application service consultations, as well as policy and platform design. Subsequently, last year they were chosen to be Cambodia's national messenger service provider, launching the 'AngkorChat' messenger platform jointly with the Cambodian government at the end of May. The AngkorChat business is overseen by the joint venture Digital Angkor. Through its local subsidiary in Cambodia, Union Mobile pushes platform businesses including advertising, intellectual property (IP), payment, gaming, shopping, online video services (OTT), and more. AngkorChat integrates services like mobile ads, OTT, music streaming, delivery, taxi calling, payment, hotel reservations, shopping, and gaming – a business model similar to how Kakao incorporates shopping, ads, gaming, and more into its 'KakaoTalk' platform. CEO Lee highlighted the growing SNS usage rate among Cambodians, from 44% (7 million) in 2018 to 75% (12.6 million) last year, and emphasized the youthful median age of Cambodians at 25.6 years (younger than neighboring Vietnam and Thailand) as indicators of high business growth potential. AngkorChat's distinct advantage over commonly used apps like 'WhatsApp' and 'Telegram' is its potential to expand with various services. Central to the platform business is securing subscribers, which will be backed by the Cambodian government's policy support. The Cambodian government actively supports increasing AngkorChat's subscribers, using it for sending official notices and as a communication platform with its citizens. Additionally, the government encourages its departments and businesses to use AngkorChat as their work messenger, reflecting a strong commitment to establish AngkorChat as the national messenger app. Interview with the Representative Q: You have a work history with LG Telecom, the predecessor of LG Uplus. What led you to join Union Mobile? A: I started my career at LG Group, where I joined a new company called LG Media to design and develop engines that could run multimedia. About a year after joining, LG Media merged with LG Software. This merged entity changed its name to LG Soft, where I was tasked with developing 'Computer-Based Testing (CBT)'. Later, LG Soft merged with EDS and was renamed LGCNS. At LG Soft, I was responsible for developing various infrastructures and systems. I moved to LG Telecom to develop a wireless internet platform, where I created the 'ez-i' service. Afterwards, I took on the role of planning and developing mobile apps, and at one point led the new business development team under the president. With the president's recommendation, I took charge of the new service development team for two years and made a career shift. After leading a team in the convergence business department, responsible for revenues from additional services, I left LG in 2008. After some rest, I began my business endeavors. At the suggestion of a director during my tenure at the LG Group, I took on the role of CEO at Union Mobile, shaping its current business structure. Q: Can you share about the projects you're pursuing in Cambodia? A: Our primary focus is on AngkorChat. We also plan to sequentially expand into OTT, gaming, banking, and payment platform businesses. We're dabbling in the educational sector as well. The open market business will revolve around a commission-based model. Cambodia surprisingly has a high consumption index and a significant economic size. Specifically, the online commerce and payment market size amounts to about $272.8 billion or about 350 trillion won. The total number of transactions barely reaches 1 billion, implying an average online shopping expenditure of about 300,000 won per person annually. As of last year, there were 22 million mobile phone users, equating to 130% of the total population, with a smartphone penetration rate of over 80%. There's potential in Cambodia since the open market isn't very active. For the food delivery business, we're discussing a joint venture with a domestic medium-sized company, Company B. We also intend to supply a gaming platform. Instead of developing games ourselves, we're looking at generating revenue through in-app purchases, similar to Kakao Games. Part of our motivation for establishing a gaming platform is to support the nearly 300 startups in Cambodia, as they don't have a platform to share their developed games. In Cambodia, in addition to messenger platform businesses, we're also exploring telecommunications. The country requires equipment and network conditions tailored to its unique needs. For instance, while a significant part of Korea's communication network is underground, Cambodia has a much lower underground rate. Special technology is required for the maintenance of pole networks. In Korea, Chairman Ro Seyong has practical experience, and the only company with that technology is LG Uplus. If we undertake network maintenance in Cambodia, partnering with LG Uplus is the baseline, and we're keen on pursuing that venture. Q: Regarding the platform business, it seems you're looking to collaborate with other companies. A: We cannot excel in all platform businesses. For advertising, we plan to work with a domestic medium-sized enterprise. As Cambodia's digital advertising market is emerging, services such as production and broadcast are not separated as they are in Korea, so we intend to provide a one-stop service. We've already established a brand named "Angkor AdWave" which offers an advertising system based on messaging. For the food delivery business, we're looking to do something similar to South Korea's "Baemin" (Baedal Minjok). The system is complex, so we've partnered with a medium-sized Korean enterprise, "Company B", which was keen on entering Cambodia. For shopping, it's an open market, so the biggest issue is sales. We plan to work with companies that can set up an efficient distribution structure. As for delivery, we're planning to contract with local businesses. Our approach is to collaborate with successful companies from Korea for different sectors. There are many startups in Korea, and we want to expand overseas with them. Telecom companies receive 300-400 business proposals annually. Companies propose business models to telecoms because of their extensive subscriber base. Nowadays, Naver and Kakao play these roles. Wouldn't it be good if we took on a similar role in a small but promising market like Cambodia? We want to be the bridgehead for Korean startups expanding overseas. We wish to incorporate excellent Korean services into our messenger and expand together. Q: AngkorChat messenger is the foundation. How do you plan to compete with popular apps in Cambodia, such as WhatsApp and Facebook? A: The competitive edge is the provision of one-stop services, including payment, gaming, banking, and delivery. While Telegram and WhatsApp is prevalent in Cambodia, the challenge lies in how a new entrant like us can compete. The Cambodian government is offering significant support. They plan to send official government notices through AngkorChat. It also seems the government will support us in securing AngkorChat users. Moreover, the name "Angkor" itself is a marketing asset. There's strong national pride associated with Angkor Wat. We're starting our marketing on the 22nd, and the traffic to AngkorChat is already increasing. Additionally, the AngkorChat platform has been designed as a revenue-generating platform. Users get rewards for certain actions they take on the platform. For instance, if an advertisement is aired, we share a portion of the commission with the customers. We've established a 'virtuous cycle structure,' allowing direct delivery and letting users earn delivery fees. Q: If you receive government support, won't you face regulatory issues in the future? A: Although the government supports us, they're not imposing anything. It's not that there will be disadvantages if someone doesn't install AngkorChat; rather, there are benefits for those who do. We have a local subsidiary, Union Mobile, but to have some regulatory safety measures, we established a company named "Digital Angkor" in early June. While the ownership of AngkorChat lies with Union Mobile Korea, the operating rights have been leased to Digital Angkor for 15 years. Q: What are the future projections regarding this business? A: Once we secure a significant number of messenger users, we plan to introduce advertising this year, and also launch character IP business, payment, and game services. We expect a substantial increase in revenue from the latter half of this year. Didn't Kakao also face challenges for 2-3 years before their significant rise? We aim to quickly generate revenue and become a self-sustaining company. We'll sequentially launch our services this year. Our projected revenue from these businesses is around 170 billion KRW in five years. We've discounted the business value by more than 19% due to potential risks. In terms of the actual operating profit in the financial statements, we anticipate about 100 billion KRW over five years.