SEOUL, South Korea -- With the emergence of a growing number of closed DRM ecosystems for online and mobile music devices in Western markets, Korea is taking an opposite approach and moving towards DRM interoperability. This shift was confirmed recently when SK Telecom, Korea’s leading mobile operator, announced its decision to implement a DRM interoperability solution based on the EXIM standard for its own online and mobile music service.

This momentum for DRM interoperability hinges on the development of the EXIM standard by Korea’s Electronic & Telecommunications Research Institute (ETRI) and INKA Entworks. EXIM, which stands for Export & Import, is a DRM converting technology standard that makes different DRM systems compatible. Up to 90% of online music sites and 70% of portable music devices deployed in Korea at the moment use DRM solutions based on the EXIM standard.

SK Telecom plays a major role in the online music industry with its service called “Melon”, which offers dual music downloads over the Internet and its own wireless network. However, the large majority of subscribers to the service prefer to purchase and download music via Melon’s Internet portal and transfer files to their MP3 phones and MP3 players through a USB cable, rather than directly to their phone over the operator’s wireless network, a method referred to as over-the-air (OTA).

The ability for all mobile subscribers to download music content through the Internet and transfer it to their phones via a USB cable is what clearly differentiates the Korean mobile music market. All MP3-equipped phones released in Korea since 2003 come with USB transfer capability. This aspect has also encouraged a repositioning of operators in the mobile music chain, where they seek revenues from music content rights rather than strictly from airtime revenues.

SK Telecom currently uses a proprietary DRM solution, which prevents subscribers from acquiring online music files from third party providers. However, its decision opens the door for independent online music providers to offer content to SK Telecom subscribers by importing songs based on other DRM formats, converting and playing them on SK Telecom’s DRM solution platform. Korea’s online music market has benefited from the wide availability of MP3-equipped mobile phones since 2003 and Korea’s two other mobile operators offer similar paying online music services featuring dual downloads modes and PC to phone transfer functionality.

“SK Telecom’s decision to implement the EXIM standard is an important milestone because of its dominant position in the mobile phone services and online music services markets. We’re happy to have SK Telecom as a partner”, said James Ahn, CEO of INKA Entworks.

SK Telecom (Nasdaq: SKM)