[Comprehensive] "Grow Future Food Sources" SKT-Shinhan Top Business Operators Unite for 'Private Data Dam'

[Asia Economy reporters Seulgina Jo and Hayoung Ki] Leading companies in various data sectors such as SK Telecom and Shinhan Card are actively engaged in building a ‘private data dam’ because they recognize the urgent need to utilize data, often called the ‘oil of the future.’ Companies have entered an era where survival depends on thoroughly personalized marketing and new business ventures based on extensive data analysis to anticipate what customers or potential customers might do in the future.

According to SK Telecom and others on the 4th, the soon-to-be-launched ‘Private Data Alliance’ aims to ultimately build a private data dam that collects, combines, analyzes, and distributes all data in the private sector. ▶Related article <'Big Data Alliance' Emerges... SKT, Shinhan Card, and Others Build Korea’s First Private Data Dam>

The participating companies are diverse. They include SK Telecom and Shinhan Card, the top players in mobile communications and credit cards respectively, as well as Korea Credit Bureau (KCB), GS Retail & Home Shopping, Homeplus, Danal, Inicis, and Real Estate 114, representing various industries. The data they hold is extensive. SK Telecom’s wired and wireless subscriber information covers 47 million people, KCB’s credit information covers 44 million, and Shinhan Card’s membership is about 27 million. Essentially, Korea’s mobility, consumption, and distribution data are gathered in one place. The door is also open for additional participants, which will secure even more diverse data as the number of participating companies grows.

This is the first time private companies are leading the construction of a data dam. These companies plan to combine various pseudonymized information (data processed so that specific individuals cannot be identified) from sectors such as distribution, manufacturing, credit, and transportation, and make it available for use in desired fields.

For example, by analyzing consumption patterns of car owners by brand, it is possible to obtain insights such as which car owners tend to spend more at department stores, enabling companies to conduct effective targeted marketing across channels. Small business owners in local neighborhoods can also receive information about the consumption characteristics and preferences of nearby residents and visitors by industry. There are also plans to support public policy formulation and improvement projects by combining this data with public data.

SK Telecom explained, "For instance, by pseudonymously combining SK Telecom GeoVision’s floating population data with Shinhan Card’s consumption information, highly advanced data products can be created for desired fields." This is expected to directly aid companies in product development, marketing strategies, and future market responses that reflect market trends. The potential use cases for data are limitless.

Recognizing the importance of the data economy early on, the United States has seen active voluntary data trading, processing, and analysis by private companies for several years. A representative example from nine years ago is when the US retail giant Target identified a high school girl’s pregnancy before her parents did based on her recent purchase history and sent discount coupons for newborn products. This is why there are criticisms that Korea, despite being an ICT powerhouse, is somewhat behind in the data economy era. Major economic research institutions have analyzed that if corporate efficiency improves by 1% due to data, an additional $15 trillion?twice the size of the US economy?could be added to the global GDP by 2030.

Jang Hongseong, head of SK Telecom’s Advertising & Data Company, emphasized, "By joining forces with Korea’s top data companies to build a private data dam, we will open a new chapter in the domestic data industry."

This content was produced with the assistance of AI translation services.