KT still appears to be falling a step behind mobile market leader SK Telecoms in its network upgrade plan and efforts to bringing more attractive smartphones.
KT Corp said today that it would invest 5.1 trillion won (US$4.3 billion) until 2014 to expand its networks to meet soaring demand for high-speed data services, sparked by the sales boom in smart phones and other digital gadgets, Dow Jones reports. KT considers that 3G and LTE alone can't be an answer to meet the explosive increase in data traffic, the company said in a statement, adding in order to prepare such a data explosion era, KT will invest 5.1 trillion won by 2014 in network services, including WiFi, WiBro, 3G, LTE, and cloud computing. KT also said it aimed to generate a total of 1.12 trillion won in sales in 2011 from smart phones and tablet computers.
* LTE Roll-Out: The network investment plan reinforces KT’s strategic priority to enhance its mobile data offering by increasing network speeds and enriching smartphone line-up. The company, one of the earliest providers in the world to launch commercial mobile WiMAX (named WiBro in Korea) services, had said earlier that it anticipated its W-CDMA, WiFi, and mobile WiMAX networks would have sufficient capacity to support "explosive" data usage growth from smartphones for the time being. The company is preparing to upgrade its network to the more advanced LTE technology, although the timing for a launch is still undecided. The company said it could start investing in LTE next year, adding Samsung Electronics and LG-Ericsson, a joint venture between LG Electronics and Ericsson, were among gear markers it would work with. Nevertheless, KT’s move appears a bit falling behind the plan by rival SK Telecom, which plans to provide commercial LTE services in Seoul in 2011 and aims to provide a nationwide coverage by 2013.
* Smartphone Line-Up: In the smartphone area, KT has an exclusive partnership with Apple for offering iPhones and will soon start selling Apple's iPhone 4. Furthermore, the operators recently started offering the premium Android smartphone—Nexus One—equipped with the latest Android mobile platform version 2.2. The Nexus One phone was a critical device for KT as the carrier had been unable to secure more smartphone models from the country's top handset vendor Samsung Electronics after Samsung turned to SK Telecom in a retaliatory action over KT's exclusive partnership with Apple for iPhones. Meanwhile, SK Telecom has recently raised its 2010 smart phone sales target to 2.5 million from an earlier estimate of two million and said it would continue expand its range of smart phones by launching a further 14 in the second half of this year to add to the nine mode it started selling in the first half of the year. Of the 23 models it will have on offer by the end of the year, 19 will run on Google's Android operating system.
* Integration of Fixed/Mobile Businesses: KT’s merger with wireless unit KT Freetel has not appeared to enable the group to narrow its gap with SK Telecom in the mobile market. At the end of March this year, SK Telecom controlled 50.7% of the country’s mobile subscriber base, while KT and LG Telecom had market shares of 31.4% and 17.9% respectively. These did not look much different from the market share data at the end of 2008, which stood at 50.5%, 31.5%, and 18% respectively. Nevertheless, the integration of its fixed and wireless businesses should in the long term help cut costs and enhance the group’s capability of offering convergent services. Following KT’s merger with KT Freetel, LG Group also merged its three telecoms units, in order to compete more effectively with the larger rivals.
