- 1. Korean Mobile Industry 2003
2. Domestic Market Condition (1)
- The Change ofthe Number of Korean Mobile Service
Subscribers
- The Change of the Amount of Mobile Phone
Source: MIC Source:Digital Times (2002, 10,7) 3. Domestic Market
Condition (2)
- Forecasted subscriber distribution by service type
Source: Gartner ,Dataquest(2000) 4. Major Players of Mobile
Industry Providers Manufacturers Source by Digital Times
(2002,9,30) 1,346 2,125 4,088 Number of Employees 14% 33% 53%
Market Share(%) 13,921.6 33,008.2 52,236.7 Gross Profit (U$:A
million) 1996,7,11 1997,1,3 1984,3,29 Foundation date LG Telecom
KTF SK Telecom Name 25,435 77,467.5 23% 1958,10,01 LG Elec. 789
3,053.0 1% 1991,3,29 Pantech&Curitel 821 646 48,364 Number of
Employees 1% 1% 74% Market Share(%) 1,876.7 2,974.2 248,253.7 Gross
Profit (U$:A million) 1992,3,11 1992,6,1 1969,1,13 Foundation date
Telson Sewon Samsung Name 5. Mobile Service Market (1)
( U$: a million )
( U$: a million ) ( U$: a million )
- Revenue Structure of Mobile Operators
Source:Dataquest 6. Mobile Service Market (2) (U$: a million
)
- Comparison of the Gross Profit
- Market Share based on Profit
7.
- Future Strategy-SK Telecom
- SKTs future growth heavily depends on wireless data service. To
drive its wireless data strategy, SKT pushed aggressive 2.5G
network rollout based on Qualcomm s CDMA2000 1x technology. The
company already reported 15,000 subscribers with Samsung and LG s
CDMA2000 1x handsets under limited coverage. At data transmission
speed of 144kbps, SKT covered 79 cities with 88% population
coverage by end of 2001 and improved the coverage to all major
highways by end of 1H02. The company s total capacity for CDMA2000
1x reached W2.0-2.5 trillion in the same period.
- Upon full commercial rollout of 2.5G network, SKT has finalized
its packet-based tariff. Based on 512 byte per packet, text-based
wireless data service is charged at W6.5 per packet while
multimedia based wireless data service will be charged at W2.5 per
packet. Compared to NTT Docomo s packet data tariff of around
W17.6, the announced tariff is 63% cheaper for text-based content
and 86% cheaper for multimedia-based content. The tariff is lower
even compared to initial price level of W12 per packet discussed
around the industry when SKT begun negotiating with Korean
government. Nevertheless, once multimedia handsets equipped with
color display and stereo sound systems are available for mass
market distribution, the company hopes more users to transmit
multimedia contents that will likely to increase usage and
revenue.
- However, with the decision to push 2.5G network rollout, SKT
delayed its 3G service based on WCDMA network from previously
planned launch in May 2002 to possibly 2003-2004. Given its massive
rollout cost of 2.5G network, the company believes that its 3G
rollout must be delayed until significant portion of 2.5G network
investment in recuperated. Further, with global delays in 3G
infrastructure and handset development, there is a internal concern
within SKT whether there is a full commercial system ready for
service in May 2002.
- Besides its core mobile business, SKT is looking to become a
platform provider and financial enabler by leveraging its core
cellular business. Currently, SKT is providing mobile platform for
cellular handsets but will be increasing its platform service to
PDA and vehicle mounted terminals and eventually expand its mobile
platform to included fixed platform. The company expects mobile
platform market to reach W2.83 trillion in 2003 at 3-yr CAGR
(2000-2003) of 203%.
- SKT also expects strong growth as a financial enabler that will
focus on providing payment infrastructure based on internally
developed solutions. The company expects financial enabler market
to reach W1.38 tn in 2005 at 4-yr CAGR (2001-2005) of 13.5%.
Mobile Service Market (3) 8.
- Although the company has fared well in 2000, KTF faced similar
growth slowdown in 2001-2002. As such, the company focused on
increasing its wireless data service that totaled W51 billion in
2000 (1.8% of total sales). At end of 2000, the 55% of all KTF
subscribers owned Mobile Explorer browser enabled handsets (vs. 26%
for SKT). Higher proportion of younger generation subscribers also
put company in a very good position to take advantage of exploding
growth in wireless data. With 83% of its wireless data subscribers
fall under age of 30, 45% of KTF subscribers are currently under
the 30 years old (vs 28% for SKT)
- In terms of 2.5G rollout, the company seems less aggressive
than SKT. In terms of capacity, the company is only looking to
invest W400-500 billion covering only 7 major metropolitan cities
rather than full nation wide coverage. With launch of KT s 3G
consortium - KT Icom, KT focused more than SKT to rollout 3G WCDMA
network earlier. However, depending on market reception and
technology development to 2.5G/3G, KTF could adjust its capacity to
provide most suitable wireless data service.
- The company launched 2.5G service in 2001 with introduction of
color handsets and acquired 700,000 subscribers by the end of 2001.
The company also introduced packet-based tariff for 2.5G and
expected 2.5G ARPU to increase roughly by 18% to W45,000.
- Besides its CDMA2000 1x network rollout, the company introduced
HDR to complement 1x network in 4Q00. With HDR, KTF could increase
its data transmission rate up to 3G-like 2.4 Mbps in a standard
1.25 MHz channel bandwidth. Optimized for packet data services, HDR
incorporates a flexible architecture based on standard Internet
Protocols (IP). HDR s IP-based architecture allows flexible
implementation of the wireless system in higher performance and
cost-efficiency. As a complementary solution to voice networks
utilizing operator s existing cell sites, towers, antennas and
network equipment, HDR technology allows KTF to leverage its
current invested infrastructure.
Mobile Service Market (4) 9.
- Future Strategy-LG Telecom
- Although the recent growth rate seems to be lower than its
peers, LGT has the highest percentage of wireless data subscriber
base among Korean operators as well as the highest data ARPU on the
back of its strong platform/contents such as JAVA (first mobile
JAVA service in the world) and WAP (first wireless data service in
Korea). Among 3.86 million total mobile subscribers at end of
February 2001, LGT had 2.16 million deployed wireless data handsets
(56.0%). The company s data ARPU of W2,251 in January 2001 was the
highest among Korean mobile operators. Nevertheless, given LGT s
higher wireless data subscriber portion and younger subscriber base
(44% of its subscriber under age of 30), LGT is still struggling to
generate strong wireless data service that will offset weaker voice
ARPU, when compared to its peers.
- In terms of its 2.5G CDMA2000 1x rollout, LGT provided
nationwide service in 2001. With its major shareholder LG
Electronics providing software based upgrade for CDMA2000 1x
upgrade, LGT s total capacity reached only W210 billion between
2000-2002 compared to W2.0-2.5 trillion for SKT and W450 billion
for KTF. Although the company argued that its CDMA2000 1x network
was fully capable of supporting all of LGT s 3.83 million
subscribers, it is still uncertain whether or not LGT could achieve
such increase in data capacity given such lower level of
capacity.
- For 3G, LGT accepted Korean government s proposal to head 3G
CDMA 2000 consortium that included Hanaro Telecom and POSCO. Under
the situation that Korean government provides enough incentives,
such as a cut in license fee, LGT obtained additional bandwidth for
CDMA 2000 service.
Mobile Service Market (5) 10. Market Share of Each
Manufacturer
- Sales volume and Market Share of 2001
A:presented by Samsung Elec. B:presented by LG Elec. Source:
Digital Times (Unit: ten thousand)
- Sales volume and Market Share of 2002
A:presented by Samsung Elec. B:presented by LG Elec. Source:
Digital Times (Unit: ten thousand) 11. Profit Structure of Each
Manufacturer
Source by Digital Times (2002,9,30) 12. Korean Major
Manufacturers (1) LG Electronics
- In terms of 3G development, the company is intensifying its
research for both 3G handsets and equipment development. SEC is
currently considered as a world s leading CDMA 2000 vendor.
- It currently controls 100% of domestic CDMA 2000 1x
infrastructure equipment order and is the first to market 1x
handsets. Based on advanced CDMA 2000 technology, however, the
company is ready against its global competitors in the WCDMA
development.
- It supplied China Unicom with CDMA 2000-1x and sold more than 7
million GSM phones in Europe.
- It is aiming to sell GSM phones as much as 1.7 million in China
and South America.
- It also plans tobuild manufacturing facilities abroad and to
balance production volume between domestic and foreign areas.
Samsung Electronics Strategic Focus
- For telecom business, LGE is heavily betting on the development
of 3G WCDMA technology to allow the company to have a significant
competitive advantage.
- It aims to be the fifth in the world market until 2005.
- It provided more than 15 million mobile phones including
domestic market and increased the amount of export in CDMA 2000-1x
and GPRS color mobile phone parts in the second half of 2002.
- It provided Chinacom approximately five hundred thousand CDMA
2000-1x.
- It also just started to enter GSM market including Europe and
China.
Name 13. Korean Major Manufacturers (2) Sewon Telecom
- Pantech s future strategy is to grow as an OEM/ODM handset
manufacturer with volume and R&D capability. Pantech internally
has increased its capacity to 10 million units in the recent years
with a belief that economies of scale are the key driver under the
low profit margin scheme.
- Pantechdeveloped about 20 new handset models - thus gradually
moved from a largely OEM to ODM producer. In particular, the
company notes that its Latin American volumes will come from models
developed by Pantech. With this objective in mind, Pantech
increased its R&D force from 200 to 300in 2001.
- The company also formed an alliance with Yogan Co. of Japan,
which provides W-CDMA software and solutions for the NTT Docomo for
development of 3G handsets.
- Pantech acquired formal Hyundai Curitel in 2001. Recently this
company made contract to supply India with three hundred thousand
CDMA phones.
Pantech&Curitel Strategic Focus
- Sewon s current strategy can be clearly differentiated from
other second-tier handset makers with its adoption of stand- alone
strategy. The management of the company believes that it cannot
secure acceptable profitability by being an OEM/ODM producer.
Therefore, it is seeking sales partnerships with telecom companies,
especially in South America and China, for its long-term
survival.
- Since OEM production generally yields low-margin output, the
company s strategy makes sense for longer-term. However, given
global handset market s consolidation to a group of top-tier
producers, the company s strategy is aggressive but risky. In
particular, with two of three Korean service providers adopting a
de-factor global 3G standard - WCDMA, there will be a less room for
smaller, specialized handset producers to thrive in both domestic
and export market.
- In recently this company settled Export-centered business
structure to China. It also made strategic alliances with Chinese
companies.
Name 14. Korean Major Manufacturers (3) Strategic Focus
- While Telson was a large-scale producer for Nokia, it has
retained some independence. For instance, even for Nokia handsets,
Telson emphasized that the relationship was on an ODM basis - not
an OEM basis. The company maintains that it will continue to be
responsible for the design and production functions, while Nokia
will focus on the marketing and sales end of the CDMA
handsets.
- If the Nokia relationship can lead to meaningful sustainable
volumes, it should have positive impact for Telson. While other
global competitors are suffering from loss of market share, it is
becoming increasingly clear that Nokia is becoming global brand
leader in mobile handsets.
- With Nokia shipment expects to grow 250% to 1.0 billion units
by 2004, Telson is aligning itself with a strong partner. Nokia s
shipment target also implies a need to increase production
capability.
- But this company is likely to stop relying heavily on Nokia and
is trying to broaden its customer base.
Telson Electronics Name 15.
- CDMA2000-1x of each manufacturer
Sourced by KISDI
- Sales Forecast of CDMA/GSM
Sourced by Data News (except for Nokia TMC) Technical Trend (1)
65,000 color STN-LCD 3 Line LCD C-500 65,000 color STN-LCD 4 Line
LCD DD-600 Pantech & Curitel IM-5100 4 Gray LCD Blue LED Back
Lighting 65,000 color LCD IM-5000 SK Teletec 65,000 color TFD-LCD
LG-SDI1100 LG Elec. 260,000 color TFT-LCD SCH-V310 65,000 color
UFB-LCD 256 Color STN-LCD SPH-X7500 Samsung Elec. LCD formModel
Manufacturer 16. Technical Trend (2)
- IMT-2000 Market Outlook in Korea
Source : Koreas Electronics and Telecommunications Research
Institute(ETRI) 4,349 14,86 1,093 623 Terminal Device 4,090 735 428
244 System(US$ mil.) 3,868 1,604 729 643 No. of Subscribers(1,000)
3 rdGen.(IMT-2000) 7,119 6,190 5,382 4,601 3,866 Terminal Device
7,321 6,907 6,395 5,814 5,190 System(US$ mil.) 24,410 24,337 24,216
24,031 23,831 No. of Subscribers(1,000) 2 ndGen.(CDMA) 2005 2004
2003 2002 2001 Category 17. Service Trend: Top Contents
- Top contents per provider
- Top contents in the profit aspect
Source:Advanced Institute of Information Technology (
www.aiit.or.kr ) 2003 Chatting/Community Mail/Message
Location/Traffic/Travel 5 Entertainment Chatting/Community Email/
chatting/ Meeting 4 Game Game Game/Entertainment 3 Others
Picture/Sound/Dictionary Others (Event, TTL etc.) 2
Mail/Character/Melody Others (External portal etc.) Picture
Friend/My bell 1 LG Telecom KTF SK Telecom Top ofthe connected
number rank Game Chatting/Community Stock/Finance 5
Stock/Banking/Ticketing Mail/Message Location/Traffic/Travel 4
Entertainment Adult thing/Entertainment/Fortune-telling
Game/Entertainment 3 Java station Game Picture Friend/My bell 2
Mail/Character/Melody Picture/Sound/Dictionary Others (Event, TTL
etc.) 1 LG Telecom KTF SK Telecom Top ofthe Information Feerank 18.
Small Technology firms (1) CASUH CarMagic Bitek Sistem Anyone
Wireless Anybil Alex Technology Airl AINet Ad Telecom AdDigital
Company Name Contents(car information), mCRM soultion Interface
telemetry control / car condition scanning www.carmagic.co.kr
82-2-3463-5396 9 PW / CDMA www.casuh.com 82-31-713-5748 10 Mobile
enterprise solution www.biek.co.kr 82-2-551-2040 8 Wireless
internet protocol conversion gateway Wireless networking devices
www.aow.co.kr 82-2-6440-0185 7 Mobile agency www.anybil.com
82-2-797-6491 6 Cyber stock trading center service ASP service,
Financial service, PDA solutiondevelopment Internet betting
solution development www.alextech.co.kr 82-2-2129-3400 5 Wired
& Wireless Combination portal site Airl service Killer service
contents,Mobile solution & SI service www.airl.co.kr
82-2-424-4945 4 Mobile internet service providing Mobile internet
solution providing www.ainet.co.kr 82-2-560-9317 3 Ad wizard
www.AdTelecom.com 82-32-860-7382 2 Mobile advertisement solution
and service Digital webcasting, mobile games, on;line games
www.addigital.com 82-2-3443-1533 1 Business Descriptions Contact
19. Small Technology firms (2) Billing solution, Billing ASP
service Integrated support center for billing www.futec.com
82-2-400-5901 Future Tech 19 Incubation, investment, consulting
www.epital.com 82-2-501-8621 Epital Holdings 17 Mobile enterprise
solution Mobile agency www.feelingk.com 82-2-3443-1007 Feelink 18
www.globalweb21.com 82-2-718-0663 www.elctricisland.com
82-2-578-0337 www.ehealth24.com 82-2-780-3575 www.digitmate.com
82-2-711-1024 www.cypus.com 82-2-3442-2818 www.cesscom.com
82-2-750-8600 www.cecraft.com 82-2-548-4634 Contact Games,
Entertainment contents Global Web 20 Provide Java-based games and
multimedia solutions using NGF via the web and mobile phones
Electric Island 16 Health information service over internet &
wireless network Medical information solution with PDA eHealth
Consulting 15 Information Services, Mobile business consulting
Mobile agency DigitMate 14 Mobile portal Mobile agency Cypus 13
Wireless PDA, Wireless solution Semi-conductor B2B service Cesscom
12 Entertainment software for PDAs Mobile CP business, SI Business
CECRAFT 11 Business Descriptions Company Name 20. Small Technology
firms (3) www.ksign.com 82-2-554-2581 www.kise.co.kr 82-2-564-6985
www.isoft.co.kr 82-2-508-5678 www.IntroMobile.com 82-2-567-3434
www.insidekorea.net 82-2-516-4749 www.infohand.co.kr 82-2-3452-7251
www.infobank.net 82-2-2189-1400 www.anfoart.com 82-2-3453-3969
www.impactra.com 82-2-578-7533 www.hntek.com 82-2-2202-2147 Contact
Information services Value-added solution KISE 29 Wireless PKI
solution VA solution KSIGN 30 Mobile internet solutions Post PC
solutions, Mobile internet entertainment ISOFT 28 Mobile integrated
solution & ASP business Mobile multimedia application &
service Consulting etc. IntroMobile 27 Mobile agency, Mobile
enterprise solution Telemetry service Inside Korea 26 Mobile
solution Digital camera Infohand 25 Mobile mail, Wireless ASP,
total solution for mobile site, Mobile internet gateway
system,InfoBank 24 Ticketing solutions & book / reservation
business Contents business (culture & wedding) Infoart 23
Device manufacturer OS platforms Impactra 22 Device manufacturer
(Handheld PCs and wireless PDAs etc.) HNT 21 Business Descriptions
Company Name 21. Small Technology firms (4) www.moinvally.co.kr
82-2-582-6114 www.mocons.com 82-2-540-6276 www.mococo.com
82-2-3430-3645 www.mobilestorm.co.kr 82-2-557-5015
www.mobilecnc.co.kr 82-2-563-5625 www.mjoynet.xom 82-2-3486-3910
www.mistream.com 82-2-575-1114 www.metamedia.co.kr 82-2-571-8195
www.mcome.com 82-2-6250-1200 www.manastone.com 82-2-529-3189
Contact XML style converting gateway XML browser phone solution
based on KVM Bluetooth stack & application solution Mocons 39
Mobile system for insurance management Isync Moinvalley 40 OS
platforms, Web browser, WAP browser Application sets Mococo 38 XML
browser, Mobile site builder, Call back url server Mobile
Multi-message Service Mobilestorm 37 Mobile enterprise solution
Mobile C&C 36 Games, Entertainment Mjoynet 35 Wireless
streaming solutions Personal broad casting solutions Mistream 34
Entertainment, Games, Information services Metamedia 33 Mobile
Enterprise solution Mobile agancy M-commerce 32 HDML, mHTML,WML
based game, Mobile Java game, Mobile device imbedded game Manastone
31 Business Descriptions Company Name 22. Small Technology firms
(5) www.opentown,com 82-2-3452-8020 www.ntisoft.co.kr
82-31-716-1136 82-2-419-8378 www.netz-soft.com 82-2-572-0510
www.netple.com 82-2-2189-5683 www.neosteps.com 82-31-712-5080
www.neomtel.com 82-2-528-9300 www.nazca.co.kr 82-2-3141-8302
www.musetel.com 82-2-476-6780 www.mstage.com 82-2-6363-0900 Contact
Mobile internet utilizer Technical solution NTI Soft 49 Games.
Mobile portal Opentown 50 Mobile enterprise solution, Mobile agency
Customer management Nslash.com 48 Mobile enterprise solution
Streaming solution Nets Communications 47 Wireless browser Mobile
banking Netple 46 Mobile modem OS platform Neosteps 45 Simple image
service Smart telemetry service NeoMTel 44 Entertainment, games
Nazca 43 Bluetooth IC for wireless internet Internet audio player
for mobile phone Wireless internet music distribution service
Musetel 42 Commerce solution Mobile enterprise solution Mstage 41
Business Descriptions Company Name 23. Small Technology firms (6)
www.uniwis.com 82-2-6001-2021 www.u2u4.com 82-2-6248-6264
www.toysoft.co.kr 82-2-517-5752 www.spreadtel.com 82-42-489-9885
www.rumex.com 82-2-518-2800 www.rchantec.com 82-2-565-3336
www.free-ism.com 82-2-539-4749 www.pointi.com 82-2-512-0232
www.palmpalm.com 82-2-6334-7700 www.ovytz.com 82-2-567-2393 Contact
Wireless data service contents holding company Mobile portal,
Mobile agancy U2U4 59 Mobile studio Mobile application server
Uniwis 60 Game, entertainment, streaming solution Toysoft 58
2.5GMobile, IMT 2000 Handset, phone,Wireless IP phoneSpread Telecom
57 Wireless internet software solution Hardware productionRumex 56
Telemetry service, Device manufacturer, OS platforms Rchantec 55
Mobile internet system integration Mobile internet solution Prism
Information System 54 Information service, Location-based service
Value-added solution Pointi.com 53 Total embedded Linux solutions
Software development kit Palm Palm Technology 52 Java platform Java
service Ovytz 51 Business Descriptions Company Name 24. Small
Technology firms (7) www.xce.co.kr 82-31-601-5821 www.wisengine.com
82-2-508-1919 www.winksoft.com 82-2-518-1987 www.widerthan,com
82-2-6240-5145 www.verytech.co.kr 82-42-934-9889 Contact OS
platforms Entertainment Personal commerce XCE 65 Mobile agency
WISEngine 64 Mobile enterprise solution Location-based service
Mobile agency WINK 63 Application based service Contents based
service Consultancy on wireless internet service WiderThan.com 62
INI(Integrated network and intelligent) SCPINI(Integrated network
and intelligent) Gate INI(Integrated network and intelligent)
Server Verytech 61 Business Descriptions Company Name 25.
Appendix-Business areas of privately-held Korean mobile companies
26. Appendix-Business areas of privately-held Korean mobile
companies 27. Appendix-Business areas of privately-held Korean
mobile companies