LG U+ joins SK Telecom in launching Samsung powered LTE networks in South Korea

Korean vendor Samsung Electronics has deployed an LTE network for LG U+, the South Korean network operator. The service went live on 1 July, the same day that rival local carrier SK Telecom, also launched a Samsung powered network.

The network employs High-Rate Packet Data (eHRPD), which according to Samsung enables seamless switching between LTE and CDMA. The Korean vendor said that it has provided multi-mode base stations that support CDMA and LTE services at the same time, which will help reduced the costs of deploying and migrating networks from the former to the latter. LG U+ said that it plans to expand its LTE roll out to provide nationwide coverage by July 2012.

Samsung currently has eight commercial LTE contracts and has partnered with more than 30 global operators including KDDI in Japan, MetroPCS and CellularSouth in US and Mobily in Saudi Arabia. It hopes that its ability to act as an end-to-end provider of LTE equipment, from the infrastructure to the terminal devices, will enable it to win further contracts. Back in May, Samsung announced a new division targeting the European network infrastructure market.

The sixth annual LTE Asia conference, takes place in Suntec, Singapore, on the 5-7th September 2011

SK Telekom has launched an LTE service in Seoul and expects 300,000 subsrobers by the end of 2011

SK Telecom has launched the first commercial LTE network in South Korea with the service going live today, 1 July 2011.

The network uses 800MHz spectrum using 5MHz of bandwidth, doubling to 10MHz by the fourth quarter of 2011. The network in Seoul comprises of 1,172 Radio Units that act as antennas and 609 Digital Units that handle data. It will also be boosted by the use of one million 800MHz repeaters for seamless coverage across the city and SK Telecom said it will deliver a maximum downlink speed of 37.5Mbps.

The operator said it expects to have 300,000 LTE subscribers by the end of 2011. It hopes to offer national coverage by 2013 taking the subscriber numbers to 10 million by 2015.

Nine LTE data devices will be released in 2011, starting with a USB dongle and LTE modem at launch. Five LTE smartphones will follow in September and two LTE enabled tablet devices in October. More LTE handsets are expected during 2012.

To accompany these the operator said it plans to launch a high-quality video call service that it said would offer eight times better image quality and two times higher voice quality over 3G video calling. The operator said the data throughput for video calls would be increased from 64Kbps to over 500Kbps.

It also plans to offer an evolved version of its T Map navigation service, T Store, a cloud based video content store and T Cloud, a cloud based storage area for personal content.

The launch follows the first demonstration of LTE in Korea held in April, where a video call was made between a building and a moving bus. It also showed off 3D video streaming and downloading of HD video content.

SK Telekom adopted CDMA 2000 1X in 2000 and said that it achieved the world’s first commercialisation of mobile phone-based 3G WCDMA (HSDPA) in 2006. HSPA+ was introduced in June 2010 and had reached 42 cities by April 2011.

The operator said that monthly data traffic recorded in June 2011 was 19 times that of August 2010 and expects a dramatic increase as high speed data enabled devices proliferate.

SKT aims to adopt LTE-A in 2013

South Korean carrier SK Telecom this week held a demonstration of LTE technology ahead of a planned commercial launch in July, announcing its intention to upgrade to LTE-Advanced during 2013.

SK Telecom plans to begin providing commercial  LTE services in Seoul in July, explaining that LTE is suitable for large volume, real time data service; interconnects seamlessly with existing WCDMA networks; and will create rapidly growing markets for equipment, handsets and chipsets. SKT expects a flurry of LTE-based smartphones and tablets to emerge in 2012, with LTE additions to its device lineup appearing in the second half of this year.

Content consumption, which is currently focused on music, is expected to expand to video, SKT said, and with LTE, the company will be able to provide smooth download of high definition VOD and seamless streaming service, which will be available as early as the second half of 2011. In addition, mobile games will become as widespread and abundant as web games, with large volume fancy graphic games and simultaneous multiplayer games in particular expected to be actively played among users.
With the standard set for completion this summer, SKT is aiming to upgrade networks by evolving to LTE-A in 2013.

The company plans to expand its LTE coverage to 23 cities including the Seoul Metropolitan Area and other Metropolitan cities as soon as possible and provide nationwide coverage by 2013. Once fully commercialised, LTE will be able to handle three times more data traffic on 10MHz of spectrum compared to the existing WCDMA networks thanks to its enhanced speed, the operator claims.

To facilitate the rollout, SKT will adopt its own cloud-based network technology named Smart Cloud Access Network (SCAN) to set up its LTE network. With SCAN, SK Telecom has successfully separated the Digital Unit (DU) and Radio Unit (RU), the two main components of a base station. Now DUs will be stored together in one area, while Remote Radio Units (RRU) – along with the antenna – will be set up in various locations and linked via the cloud, enhancing network operation efficiency. Also, with full-fledged application of cloud computing technology, the network will be able to flexibly and seamlessly handle mobile data traffic that varies by time and region.

The company also announced an early application of Coordinated Multi-Point (CoMP) technology to its LTE network, which is designed to prevent base station interference and abrupt call disconnections in coverage boundary areas by enhancing signal strength, the lack of which leads to significant drop in data transmission speed. Most mobile carriers are planning to adopt this technology to LTE-A networks, SKT said.
LTE femtocells will also get a look in to enhance underground and indoor coverage as well as widespread deployment of 2G repeaters as it plans to provide LTE service in the 800MHz frequency band, which it used for 2G (CDMA) services.

KMI's application for spectrum was rejected

South Korea’s telecoms regulator KCC has kicked would-be operator Korea Mobile Internet’s (KMI) licence application into touch for a second time following the latter’s failure to achieve the minimum requirements to secure the licence.

KMI was bidding to become South Korea’s fourth mobile operator but failed to impress with its business plan, which the regulator said was long on optimism but short on details.

Plans to attract at least ten million subscribers were found to be “missing details” while KMI’s belief that negotiations with other carriers on the sharing of base stations and interconnections would go smoothly was deemed positively rosy.

The Korea Herald reported that, in addition to its failure on the licensing front, KMI’s application for mobile broadband spectrum was also rejected. The KMI consortium had applied for a licence to operate on WiBRO and was planning to offer services at 20-30 per cent less than market stalwarts SK Telecom, KT and LG Uplus. This is the second time that KMI’s bid has been rejected – the first was in November 2010. Whether it decides to go for third time lucky remains to be seen.

The focus of the lab would include R&D and industry collaboration on advanced broadband wireless technologies that support industry megatrends such as cloud computing, M2M, smart devices and other new form factors.

Ericsson sets up 4G lab in South Korea

Swedish kit vendor Ericsson said Monday it has struck a deal with the South Korean government to set up a 4G research and development facility in one of the world’s most technologically advanced countries.

Ericsson is understood to be sinking about $1.5bn into the strategy over the next five years, which will focus on mobile and green technologies and could create up to 1,000 new jobs.

South Korea said it is looking to build a green eco-system around a community dedicated to developing sustainable climate solutions based on 4G technologies, such as LTE.

Commenting on the announcement, Ericsson CFO and incoming CEO Hans Vestberg, said he believes that the offsetting of CO2 emissions will require new ways of conducting business and new ways of living, and will also require large scale investments in IT and communications technologies, as these sectors could offset societal CO2 emissions by more than 15 per cent by 2020.

“Telecommunications and IT technology will play a vital role in transforming cities and countries through smarter broadband solutions. As one of the world’s most advanced nations in the use of ICT, Korea has the opportunity to create a green eco-system and become a great example for the rest of the world,” said Vestberg.

Since the operators began offering their full IPTV services with live broadcast channels in December, supplanting their previous VOD-based offers, they have added only about 250,000 subscriptions in total.

Their lackluster progress means they are nowhere near reaching the government’s target of 2 million full IPTV subs by year-end. At their current growth rate, they will be very lucky to hit even half that number.

Korea’s IPTV players have now realized that although it was relatively easy to create a 1.6 million-subscription base for their VOD-based IPTV services, luring subs to a full pay TV service is a different prospect altogether.

KT and SKB rapidly developed their VOD-based IPTV subs bases by giving away settop boxes to their broadband subscribers and allowing subs to graze as lightly as they wanted on the VOD-based services, at no minimum monthly charge.

Their introduction of live channels, though, has meant that the operators have now had to introduce full monthly subscription charges that are essentially forcing subscribers to choose between keeping their existing cable TV subscription and taking up one to IPTV.

Although the IPTV operators have all spent heavily on acquiring content, they are still unable to offer the same number of channels – or indeed the same quality of channels – that are available on digital cable platforms.

As a result, the vast majority of cable TV subscribers – numbering about 15 million in total and representing about 90% of TV homes – have opted to keep faith with their cable TV services and not take up full IPTV subscriptions.

Where to now?

The abysmal adoption of full IPTV services in the past six months has left all three IPTV operators in a tight spot – especially broadband market giant KT, which has spent large amounts of money on IPTV in the hope that it will replace its fast-declining fixed-voice revenues.

With its 150,000 subs at mid-June, KT has been the best performer in the full IPTV stakes, but it has been able to attract that number of subscriptions only because of the rock-bottom KRW8,000 (US$6.25)-a-month charge for its Qook TV service.

KT’s IPTV fees are less than half those charged by digital cable TV operators for their more extensive platforms. They are also KRW3,000 a month cheaper than SKB’s Broad&TV service and KRW5,000 a month lower than LG Dacom’s MyLGtv.

As a result of its low subscription charges, KT is already operating Qook TV at a heavy loss. Its losses will increase once it adds more channels to the platform, putting it under further pressure to raise its subscription rates.

But it is only by adding more channels – and high-quality channels at that – that any of the IPTV operators can seriously hope to compete with and begin taking subscriptions from the country’s cable TV operators.

At the moment, many of South Korea’s leading cable TV providers have refused to supply their channels to the IPTV operators – and have done so even though KT in particular has made some very substantial offers for carriage deals.

This is because these cable-channel providers generate huge advertising revenues from their access to 15 million cable TV homes and are terrified of being kicked off cable networks by cable operators if they sign carriage deals with IPTV operators.

As a result, IPTV operators are effectively fighting with one hand tied behind their back, because they cannot offer the same popular channels that cable TV operators are screening, which makes cable TV subscribers highly reluctant to defect to IPTV.

Despite making extensive efforts to acquire their own content from both foreign and domestic providers, the IPTV operators have little choice but to carry on pushing the reluctant channel providers into striking a deal and hope that their persistence pays off.

The problem is, of course, that the IPTV operators are in a classic chicken-and-egg situation, given that the channel providers won’t move to IPTV until the IPTV operators can offer a mass subscriber base from which ad revenues can be generated. But they can’t get that base until they have access to all the best cable channels.

Time to pay up to terrestrials

As if the IPTV operators did not have enough to contend with, they are facing the problem of the three major terrestrial broadcasters, KBS, MBC and SBS, banging on the door and demanding that the IPTV operators sign permanent carriage deals.

The broadcasters are threatening to withdraw their channels from the IPTV platforms if each IPTV operator does not agree to pay each terrestrial broadcaster US$30 million a year for carriage on their platforms.

This means that IPTV operators would each be paying a staggering US$90 million a year in carriage fees for terrestrial channels alone – a crippling burden for the operators that only KT is likely to be able to afford in the long term because of its huge financial resources.

Nonetheless, the IPTV operators also realize that losing carriage of the terrestrial channels would be a commercial blow: It would mean that their subscribers would also have to maintain a cable TV subscription in order to view the highly popular terrestrial channels.

No turning back now

There is little doubt that the IPTV operators find themselves in a tight spot, but their strategic options at this point remain limited, and they really have little choice but to keep going and hope for the tide to turn.

KT is clearly in the strongest position of the three IPTV operators because of its greater financial muscle and more extensive network infrastructure.

Although KT does need to match the content offered by the cable TV operators, it also needs and move the battle with those operators away from solely being about content. Instead, it should fight more on its strength in having both fixed and mobile networks at its disposable.

KT is best-placed to move into the fixed/mobile convergence era because of its extensive FTTH assets and its recent merger with mobile operator KTF. It needs to use these strengths to offer compelling FMC services to subscribers.

At the moment, the cable TV operators are able to use their hold on key cable-channel providers as a fig leaf to cover their weaknesses in offering FMC services, and KT needs to turn up the pressure on the cable operators by ramping up its own FMC services.

Of course, the FMC road map remains largely unknown, with operators all over the world struggling to work out how to generate revenue from FMC services. Yet for KT, this is really their trump card in persuading subs that they should migrate from cable and take up next-generation services that can offer them real value.

The IPTV operators have truly gotten off to a bad start in the full IPTV era, but the battle has really only just begun. And with all three IPTV players able to offer FMC services – although KT is in by far the best position – the key will be to maximize this advantage and put the pressure back on the content-rich but technology-poor cable TV operators.

Like the little boy who cried wolf in the old fairytale, South Korean telecoms firms SK Telecom (SKT), SK Broadband (SKB) and LG Telecom (LGT) look like they might finally pay the price for years of crying for help when none was needed.

The three operators have long taken the view that their best form of defense in the regulatory battlefield was to block every regulatory break sought by fixed-line giant KT by complaining loudly to the government.

Those tactics have worked reasonably well for much of the last decade, but now the companies seem to have run out of luck as they try to block the merger of KT and mobile subsidiary KTF.

As usual, the operators are protesting to block the merger, claiming that it would place a merged KT/KTF in a dominant market position, but the Korean Communications Commission (KCC) seems set to dismiss their complaints as nothing more than the usual obstructionism and approve the merger.

The irony is that this time, the three operators really do have good reason to be fearful of a merged KT/KTF but have little political capital left with which to pressure the KCC to reject the deal.

A KT/KTF merger is dangerous for its rivals in both the broadband and mobile markets because it would finally give the merged entity the chance to properly integrate its products as a bundled offering for subscribers.

KT already resells KTF’s mobile services and offers bundled offerings to subscribers, though with only a limited discount because of the KCC’s tight restrictions on the discounts it can offer on bundled services.

But the KT/KTF cooperation deal has never felt particularly convincing in its implementation and has always seemed like a stopgap solution – and not completely unintentionally, in my humble opinion.

For KT, which has long considered a merger with KTF to be its best chance to get into the lucrative mobile market, there has never been much incentive to make a mere cooperation deal with KTF successful because it could have compromised its chances of proceeding to a full merger.

But now KT’s longstanding dream of merging with KTF looks set to become a reality, with the economic and political climates aligning nicely to make it hard for the KCC to reject the proposed merger, given that KT is able to argue that a merger will bring considerable cost savings.

Moreover, with a single management team rather than the separate structure now in place, the merged KT/KTF can finally have a genuine chance of operating as a full-service operator.

Perhaps a key reason for KT’s big push for a merger is the fact that it is seeing momentum in the broadband and IPTV markets shift significantly toward its own services at the expense of SKB and LG Dacom.

The main factor behind its confidence is the fact that KT is the only operator in the broadband market with the financial muscle to both roll out a nationwide high-speed broadband network and pay for the type of high-quality content needed to build a substantial IPTV-subscription base.

By contrast, SKB has access to reasonable-quality content via parent company SKT’s recent acquisitions in the content sector but has a Seoul-centric broadband network that cannot hope to match KT’s nationwide network.

LG Dacom and sister company Powercomm have deployed an impressive network infrastructure in most of the country’s major markets, but – and it is a big but – they are a long way behind KT in terms of IPTV infrastructure in terms of both subscription count and quality of IPTV content.

It is beginning to feel as though KT has begun to inexorably tip the pay TV market in its favor and as though its huge financial powers have finally persuaded the cable channels – long resistant to KT’s presence in the pay TV market – that they have no choice but to cast their lot with KT.

With the broadband and IPTV markets moving so surely in its favor, KT appears to have decided that the time is finally ripe to take on SKT’s longtime dominance of the mobile market, where KT has effectively been more or less a frustrated spectator.

SKT is well aware that KT has long stared avariciously at the mobile market – hence its fierce protestations to the KCC about the proposed merger – and knows that a merged KT/KTF would do all it could to end SKT’s market leadership.

But providing an improved bundled service offering alone is unlikely to be enough to shift the mobile market decisively in KT/KTF’s favor on its own, given that local subscribers have treated their mobile subscriptions as distinct from their residential broadband and pay TV subscriptions.

Nonetheless, with its longtime exclusive grip on the so-called golden spectrum in the 800MHz band soon to come to an end, SKT knows that a merged KT/KTF will be pushing hard for a share of the spectrum to improve its position in the mobile market.

What is more, KT holds the ace of its near-nationwide WiBro network up its sleeves to help in it a head-to-head battle with SKT, which has turned its back on WiBro in favor of HSPA.

The country’s HSPA networks have proved extremely popular for mobile subscribers but are rapidly getting congested as mobile subscribers access both voice and data services, causing a fair amount of congestion.

By contrast, with only a couple hundred thousand subscribers on its WiBro network, KT still has plenty of room to feed the voracious appetite of local subscribers for mobile broadband services – if it can provide the right hardware at a reasonable price.

KT has been waiting a long time to provide a full service offering to the country’s mobile and broadband subscribers, and it is getting a golden chance to do so via a merger with KTF – which it feels it cannot afford to miss.

The crucial question is how SKT, LGT and LG Dacom will respond to the situation.

LGT looks to be in a hopeless situation. Its lack of a WCDMA technology-migration path is looking ever more painful for its future growth prospects as its rivals gain traction with their HSPA services.

SKT must decide how much it is willing to spend on making SKB a genuine threat to KT in the broadband and IPTV markets.

At the moment, SKB provides willing but limited opposition to KT in the broadband and IPTV sectors, and unless the operator is willing to spend big – a tough prospect in the current market environment – on extending its reach in the broadband market, a merged KT/KTF could well become kingpin.

SKT, South Korea’s number one mobile operator in terms of subscribers, has already acquired fixed broadband player Hanaro and so can provide quadruple-play services of its own. So too can the LG Group, the country’s third biggest telecom player, which also has both fixed and mobile networks at its disposal.

The KT/KTF merger may also give a boost to KT’s WiBro service, the mobile WiMAX brand in South Korea. “A KT/KTF merger would help to offer a tightly-coupled pricing plan of WiBro and HSDPA data services together,” said Dr. Hyun-Pyo Kim, director of the WiBro Business Unit at KT, in an e-mail exchange with WiMAX Vision last year. “In addition, limited coverage of WiBro-especially in small cities or rural areas-would be supplemented by KTF’s HSDPA network.”

NTT DoCoMo, Japan’s leading mobile operator by subscribers, owns 10.7 percent of KTF. KT says it will sell $253m bonds to NTT DoCoMo, exchangeable into stocks, as part of the merger plan. NTT DoCoMo is planning to transfer 60 percent of its holding in KTF to KT.

WiBro gaining market traction

Korea’s fixed-line incumbent is looking to discounted bundled offers, increased network coverage, more devices and Wave 2.0 kit to spur WiBro take-up.

WiBro, Korea’s Mobile WiMAX service brand, is beginning to gain market traction. After a slow start, primarily due to limited network coverage and a very small range of devices, KT (Korea Telecom) reports that it had over 200,000 subscribers by August 2008.

This number may still appear small for a country that has a population of 48 million, a mobile penetration in excess of 90 percent and, at the end of 2007-according to figures from Informa Telecoms & Media-a household broadband penetration of 80 percent (of which KT has a 45 percent share).

But there are grounds for WiBro optimism. Although KT technically launched WiBro back in June 2006, it was only operational in five selected areas in Seoul. It wasn’t until April 2007 that KT launched full commercial WiBro service across the entire Seoul area, which helped to generate greater interest in the service. By the end of 2007, KT’s WiBro subscriber base reached 100,000, which more than doubled in size eight months later.

Supporters of cellular technology might argue that 3G, and particularly HSDPA, will be the more popular route in Korea to higher data speeds on the move. Pyramid Research says there were nearly six million HSDPA subscribers in Korea by the end of 2007, which is a strong growth rate given that mobile operators KTF (53 percent owned by KT) and SK Telecom-the country’s largest mobile operator in terms of subscribers-only started offering a nationwide HSDPA service at the beginning of 2007.

But Dr. Hyun-Pyo Kim, director of the WiBro Business Unit at KT, points out that most of the new HSDPA subscribers in Korea come from current 2G and 3G users who have been tempted to upgrade to new devices by high subsidies. “There’s not much change in the total number of mobile voice subscribers and pure market growth is negligible,” says Dr. Kim. “The mobile broadband data market, however, is a totally different story. This is a newly emerging market and most of the WiBro subscribers are new data service users who didn’t switch from other alternate services. The increase of WiBro subscribers implies almost pure and new market growth.”

WiBro differentiators

Dr. Kim expects a number of factors will boost WiBro take-up going forward. These include the extension of the WiBro network beyond Seoul and a wider range of attractively priced devices.

The introduction of bundled packages that leverages KT’s mobile operation (KTF) and its dominant market share in fixed broadband is also central to the WiBro growth strategy. By offering downlink data throughput of 3Mbps for both nomadic use and on the move (at speeds of up to 120km per hour), Dr. Kim believes WiBro can be complementary to FTTH and cellular services. (According to figures from Informa Telecoms & Media, FTTH-offering symmetrical speeds of 100Mbps and above-had a 37 percent market share of the fixed broadband market at the end of 2007; KT reported it had more than one million FTTH subscribers by August 2008.)

“A key market differentiation for us will be to offer a bundled package of either cellular and WiBro, or fixed broadband, cellular and WiBro,” says Dr. Kim. “Customer can then get price discounts on the individual services.”

In July 2008 KT introduced its ‘WiBro+Nespot (wifi)+Megapass (fixed broadband) bundled package at a 32 percent price discount compared to the cost of subscribing to each service separately. Dr. Kim expects handsets that allow hand-off between WiBro and HSDPA networks, mid-session, to become available “soon”. This would increase the attractiveness of a discounted HSDPA/WiBro offer still further.

KT has not always been allowed to offer discounted bundled offerings. It wasn’t until early 2007 that the Ministry of Communications (MIC) removed KT’s status as a dominant market operator and, by doing so, put the incumbent in a much better position to use for competitive advantage its range of fixed and mobile services through bundled offers. This is important given that SKT acquired fixed broadband player Hanaro last year and can provide quadruple-play services of its own. So too can the LG Group, the country’s third biggest telecom player, which also has both fixed and mobile networks at its disposal.

Up until the introduction of bundled packages, WiBro had only two pricing plans available: $10 for 1GB per month, and $20 for 30GB per month. By contrast, KTF’s current data pricing per month is $22 for 2GB, and $33 for 4GB, which might suggest there is a danger that WiBro cannibalises HSDPA data revenue. Dr. Kim believes not. “KTF is focusing on voice and handset devices with HSDPA rather than data-centric devices,” he says. “It’s a different strategy.”

If a KT and KTF merger should happen, and talks are underway between the two companies to achieve this, there could be even more scope for strategic cooperation. “A KT/KTF merger would help to offer a tightly-coupled pricing plan of WiBro and HSDPA data services together,” says Dr. Kim. “In addition, limited coverage of WiBro-especially in small cities or rural areas-would be supplemented by KTF’s HSDPA network.”

Wider coverage, more devices

By March 2007 WiBro coverage reached across all of Seoul, Bundang and several hot zones, including 17 university campuses near the country’s capital. The accumulated capex bill by 2007 was $670m.

For an additional $130m of investment during 2008, KT has extended WiBro coverage to 19 cities surrounding Seoul in the Gyeonggi province. These extension areas will go live from 4Q 2008, which will increase WiBro’s population coverage from 12 million to 24 million.

The extension areas will use more than 500 Wave 2 WiBro base stations-all supplied by Samsung-which incorporate MIMO and smart antenna technology. “With Wave 1 equipment [in Seoul] we managed 19Mbps on the downlink and 5Mbps on the uplink in each base station sector,” says Dr. Kim. “With 2×2 MIMO Wave 2 equipment, we can double that throughput, which will increase the usage of multimedia applications.”

KT intends to start upgrading its Wave 1 network in Seoul, although no timetable for that has yet been publicly disclosed.

Dr. Kim does not reveal either how many WiBro subscribers (and the ARPU level) that KT needs to break even on its WiMAX investment. But earlier this year, KT set an ambitious goal of 410,000 WiBro subscribers by the end of 2008.  “It’s not going to be easy to achieve this,” concedes Dr. Kim, “but we’ve now got the main drivers for growth in place: increased coverage and a greater number of devices.”

The range of WiBro devices, as of August 2008, stood at 21 terminals: three handsets, eight portable PCs and ten USB modems .To help stimulate growth, KT offers the USB modems for free, provided the customer signs up for at least an 18-month contract.

In July 2008 KT announced three mini-notebooks eligible for a discount on purchase if customers sign up for WiBro service at the same time. Buyers of the Asus EeePc 701and Kohjinsha E8 receive a KRW200,000 ($190) rebate (equivalent to a 30 percent discount) if they sign up to an 18-month WiBro contract. Those fancying the HP 2133 notebook have to commit to a 24-month contract to qualify for the rebate. None of these mini-notebooks have built-in WiBro support so they need USB modems.

“Navigation and internet browsing  area two applications that have high market potential to drive WiBro subscriber growth,” says Dr. Kim. WiBro plug-in navigation devices from Mercury and Inits are currently available, while WiBro-embedded navigation devices, says Dr. Kim,  will be released soon “from many companies”.  KT expects MIDs (mobile internet devices) to become available during Q4 2008.

Despite the increasing number of devices coming into the market, the 1A band class (2.3GHz frequency band and 8.75MHz channels) used for WiBro is unlikely to receive the same level of vendor support as the more mainstream band class 3A ((2.5GHz frequency and 5/10MHz channels).  This, in turn, would appear to limit WiBro’s chances of competing with the vast array of devices, at different price points, that are currently available for HSPDA.

Developments at the chipset level, however, could change that. “We’re seeing prices of a single chipset supporting dual-band class 1A/3A coming down to the same level as 1A only chipsets,” says Dr. Kim. “I would expect 1A/3A devices to become available by the end of this year.”

This would give WiBro an opportunity to benefit from device development at 2.5GHz as well as open the door to roaming with Sprint’s Xohm in the US and Japan’s UQ Communications. Using the 2.5GHz frequency band and counting KDDI and Intel among its investors, UQ is scheduled to start commercial Mobile WiMAX service in summer 2009.

VoIP over WiBro?

If WiBro were a standalone operation, KT would no doubt welcome VoIP with open arms-a clear way to boost subscriber growth. But the incumbent’s affiliation with KTF muddies the strategic waters. The cheaper data prices of WiBro compared to cellular would mean that VoIP, as a data application, could potentially pose a threat to mobile operators’ lucrative voice revenue, especially if attractive and competitively priced handsets became available. As such, the current government ruling not to allocate a mobile numbering system to VoIP over WiBro, which would enable WiBro users to communicate with PSTN and cellular networks, may well be one that has KT’s support.

The regulatory environment in Korea is, however, changing. MIC has been replaced by KCC (Korea Communications Commission) and the new regulatory body appears much keener on VoIP over WiBro. In July 2008, KCC announced it had directed researchers at the Korea Information Society Development Institute (KISDI) to investigate the long-term effects on the mobile market of allowing WiBro operators to offer voice services using a mobile numbering system. Moreover, KCC is reportedly considering the award of MVNO licences that would allow the winning bidders to offer VoIP calls over the WiBro networks of both KT and SKT.

Dr. Kim says that no decision has yet been made at the corporate level whether or not KT would offer VoIP over WiBro if the regulatory environment allowed it. At a technical level, however, VoIP over WiBro-and voice call handover between WiBro and CDMA networks-has already been successfully demonstrated.