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Tag: south-korea

  • South Korea's KT Absorbs Mobile Unit In Battle For customers


    South Korea’s fixed-line operator, Korea Telecom (KT), is to merge with its majority-owned mobile unit, KTF, the country’s second-largest mobile operator.

    The merger is an effort to offer bundled fixed and mobile services and increase its global exposure.

    KT’s move is seen as necessary if it is to compete with SK Telecom and LG Telecom.

    South Korea’s mobile and household broadband markets are approaching saturation and operators in the country are battling for customers.

    This has led to the offering of products bundling fixed-line, broadband, Internet TV and mobile services.

    The deal ends months of speculation and will see KT absorb the mobile unit, of which it owns 54 per cent.

    NTT DoCoMo, Japan’s largest mobile operator, also owns 11 per cent of KTF.

    The terms of the deal mean KTF shareholders will receive 0.719 of a KT share for every KTF share they own.

    KT is also to sell USD $253 million bonds exchangeable into its stocks to DoCoMo as part of the merger plan.

    The Japanese firm will transfer 60 per cent of its holding in KTF to KT.

  • Signs that South Korean handset barrier may be lifted offers alluring prospect to foreign manufacturers










    South Korean regulations requiring handset applications to be based on a homegrown technology are largely why the country’s mobile phone market is dominated by Samsung Electronics and LG Electronics.
    As a result of the WIPI ruling – the acronym stands for wireless internet platform for interoperability – foreign companies have found it too expensive to produce handsets tailored for South Korean consumers.
    Nokia is virtually absent in the country and Motorola is a minor competitor with less than 5 per cent of the market. Apple has kept its iPhone out of the market because of the WIPI rule.
    Yet international handset makers are keen to enter South Korea, one of the world’s most technologically advanced and expensive telecoms markets.
    Now President Lee Myung-bak’s newly elected government has expressed a willingness to soften the WIPI rule, potentially opening the door to foreign handset makers.
    The move comes as criticism of the WIPI regulations grows, based on the argument that it restricts Korean consumers’ choices,
    Some analysts believe that, even if Korea does soften its rules, foreign companies could still find it tough to break the into the Samsung and LG-dominated market.
    But there is no doubt that if the protection barrier is removed there will be no shortage of foreign handset seeking to end their dominance.