South Korea’s untact society: A contactless reality

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  Quantumrun Foresight
• August 5, 2024

Insight summary

South Korea's transition to an untact economy showcases a move towards digital interactions over physical ones, impacting everything from commerce to healthcare. The government's heavy investment in digital infrastructure signals a strategic effort to position the country as a leader in the future digital landscape. This shift, while streamlining processes and expanding access to services, also raises questions about the effects on community connectivity, mental health, and the digital divide.

South Korea’s untact society context

The rise of the "untact" (contactless) economy in South Korea, propelled by the COVID-19 pandemic, has underscored the societal shift towards non-face-to-face economic activities. Start-ups have played a crucial role in this transformation, innovating in autonomous navigation solutions, digital healthcare, and on-demand services to minimize physical interactions. This shift is supported by government policy and substantial investment, such as the 9-trillion won (USD $6.7 billion) "untact growth fund," demonstrating a clear vision for a society where digital interaction becomes the norm. 

South Korea has long positioned itself at the forefront of technological integration into daily life and societal functions, setting a global benchmark for what a digitally enabled future might look like. This initiative is epitomized in the nation's strategic embrace of the Metaverse, a movement that gained momentum well before such concepts became mainstream in the Western tech discourse. For instance, nine months before Mark Zuckerberg rebranded Facebook to Meta, the South Korean government had already earmarked a substantial investment of USD $7.5 billion towards digital technologies for 2022, dedicating a significant portion to the development of the Metaverse and cloud services. This initiative underscores a deliberate, state-led approach to secure a competitive stance on the global stage, with aspirations of elevating South Korea to the world's fifth-largest Metaverse market.

Seoul plans to launch a virtual public center by 2023, where avatars handle administrative services, marking a pivotal step towards achieving a fully operational city government in the Metaverse by 2026. This initiative is part of a broader strategy to harness digital twins, live virtual reality (VR) experiences, and virtual tourism to cultivate an expansive metaverse ecosystem. Such developments not only reflect Seoul's long-standing reputation as the world's most connected city but also demonstrate a concerted effort to leverage gaming, which is deeply ingrained in South Korean culture. (The country was also the first to deploy 5G).

Disruptive impact

The convenience of untact services, such as virtual public centers and e-commerce, allows for more efficient management of personal tasks without needing physical presence, potentially saving time and reducing stress associated with in-person errands. However, increased reliance on digital interactions may worsen mental health and diminish community bonds. Moreover, as digital literacy becomes increasingly crucial, those without access to or knowledge of the latest technologies might find themselves further marginalized, highlighting a growing digital divide within the population.

Companies that adapt to offer remote services and digital products could see an expansion of their customer base, as geographical limitations no longer restrict them. This trend could also drive efficiency gains and cost reductions, as digital platforms often streamline operations and reduce the need for physical space and resources. However, businesses that fail to adapt to this digital shift may struggle to remain competitive, and the rapid pace of technological change could significantly strain companies needing to continuously innovate and update their services to meet evolving consumer expectations.

On a local level, policy makers need to ensure that digital infrastructure is accessible and equitable, aiming to prevent a digital divide among their citizens. Globally, South Korea's leadership in untact technologies and the Metaverse could serve as a model for other countries, potentially establishing new standards for digital governance and international collaboration in the digital space. However, the shift towards digital services requires robust cybersecurity measures to protect sensitive information and maintain public trust in government services. Additionally, as digital economies require different skill sets, governments may need to invest in education and training programs to prepare their workforce for future demands.

Implications of South Korea’s untact society

Wider implications of South Korea’s untact society may include: 

• Increased virtual engagement leading to more diverse social networks but potentially less depth in personal relationships.


• A rise in telecommuting options, reducing commuter traffic and its associated environmental impact.


• Shifts in labor demands, with a growing need for tech-savvy professionals and a decline in traditional retail and service jobs.


• A surge in online education platforms, making learning more accessible but challenging traditional educational institutions.


• Enhanced efficiency in government services through digital platforms, though raising concerns about digital surveillance and privacy.


• Retail businesses adopting more sophisticated online sales models, leading to the decline of physical stores.


• Increased emphasis on cybersecurity investments by businesses and governments to protect against data breaches and cyber attacks.


• Urban areas seeing reduced foot traffic, influencing public space usage and city planning towards more green and recreational areas.


• A notable shift in healthcare towards telemedicine, improving access but requiring new regulations and standards for quality care.

Questions to consider

• How could the shift to untact services change how you interact with your local community and government?


• What skills might you need to develop to thrive in a job market increasingly influenced by digital and remote work trends?