Inside the hermit Kingdom:
It and Outsourcing in north Korea
The OutSIde wOrld’S view of North Korea ranges from the fear of nuclear demagoguery, through tales of economic difficulties, to the fun poking of the film Team America. Behind
these and many other—almost universally negative—projected images of the
country, there is another side. Somewhat unexpectedly, the Democratic
People’s Republic of Korea—to use its
official title—has a sizeable IT sector.
Some 10,000 professionals work in the
field, and many more have IT degrees.
They are already engaged in outsourcing contracts for other countries, and
keen to expand further.
north korea’s it Sector
The origins of the local IT sector can
be traced back to the 1980s, with the
establishment of various IT research
organizations and the creation of IT
faculties in higher education institu-
tions such as Kim Il Sung University
and Kim Chaek University of Technol-
ogy (the latter having an international
collaborative research program with
Syracuse University). Over time, sev-
eral hundred IT “corporations” have
emerged, which fall into three main
types, all state owned in whole or part.
having access to
a pool of highly
labor is a key rationale
behind the growth
of it outsourcing
in north korea.
its export work, KCC’s main focus has
been the local market and it develops
various products, such as Red Star (the
North Korean version of Linux), e-learn-ing products, and translation software.
KCC also produces games; their version
of Go, a popular Asian chess-like game,
has won the Go computer games world
championship for several years. Similar, but smaller corporations such as
the Pyongyang Informatics Centre and
Korea Pioneer Technology are employing hundreds of staff.
Some IT firms have developed
from the internal IT departments of
large commercial enterprises, such
as Unha Corporation or Korea Roksan
General Trading Company. As the
country’s IT sector has become more
dynamic, some of these are being
spun off as separate ventures, allowing the IT firms to take on a broader
scope of clients and IT service activities. Third, there are a number of
joint venture IT firms. These include
Nosotek (set up with a German entrepreneur) and Hana Electronics
(which involves U.K. investment),
plus several joint ventures with Chinese business partners.