HOW TO OPERATE
Huawei Technologies
KT’s mobile WiMAX business model
By Zhao Yahui
From the earliest days of WiMAX, Korea Telecom (KT) has been one of the
foremost advocates and a trailblazer in WiMAX application. KT’s success as a
telecom operator and as a WiMAX pioneer has attracted worldwide attention.
The following insights are taken from a speech by Dr. Hyun-Pyo Kim, Director of
the WiBro Business Unit at Korea Telecom. (WiBro: Wireless Broadband, Korean
brand name of mobile WiMAX.)
providers. To provide reliable and true
mobile broadband service (Mobile 2.0), KT
WiBro has now committed to establishment
of a mobile WiMAX network.
The mobile WiMAX network will
accommodate three trends in modern
communication development: IP-based,
mobile, and broadband. The main features
of Mobile 2.0 service based on mobile
WiMAX will deliver: (1) An open platform
supporting complete Internet browsing,
(2) User-generated contents (UGC), (3)
High speed delivery, and (4) Low cost
functionality and operation.
Learning from success
K
orea Telecom pioneered the
world’s first mobile WiMAX
ser vice in 2006 and, since
then, has continued to rapidly
deploy innovative WiMAX-based services.
Neighboring countries, with similar
hinterland such as Malaysia and Taiwan,
are expected to develop similar WiMAX
models. With global relevance in mind,
this article is focused on KT’s marketing
strategy, business achievements, and
practical experience obtained in a region
and economy highly suited to WiMAX
deployment.
Responding to changing
lifestyles
Enhanced communications and the
mobile Internet have changed the life of
Koreans. However, current mobile Internet
based on cellular network cannot support
heavy traffic and can only support Mobile
1.0 service. Mobile Internet is expensive in
any economy, and evolving needs make it
no longer the optimum technology to meet
the multi-service/multi-platform demands
of today’s customers and their source
As a WiMAX pioneer, KT WiBro
has accumulated a literal treasure trove
of operational experience. KT has
determined optimal end-to-end equipment
applications, including terminal equipment
for end users. For customers the company’s
pricing studies have resulted in competitive
but affordable pricing for WiBro services.
From a corporate standpoint the pricing
strategies are equally attractive - while the
promotional price for 1G services is only
USD10, KT still realizes increasing profits.
KT has also achieved the best network
quality. When compared with other 3G
networks, the WiBro service demonstrates
clearly superior uplink and downlink
rates. Again, this plays to customer
satisfaction and increased applications by
users and service providers. Finally, WiBro
provides convergent services such as an
open platform based on an IP network to
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HOW TO OPERATE
KT’s mobile WiMAX business model
support a mobile triple play service.
Phase-by-phase network deployment
Following the granting of KT’s license in early
2005, the mobile WiMAX network was deployed
in selected regions for a two-month trial period in
May 2006 - with some equipment being tested with
commercial application. After the trial period, KT
launched soft commercial service for this region.
The full commercial service provision for Seoul
formally commenced in April 2007, and KT has
continued to expand the coverage phase by phase.
Subsequently, KT’s network will soon be able to
support MIMO, which is expected to enhance
network performance even more.
K T ’s m o b i l e W i M A X n e t w o r k g o a l s a r e
to provide seamless services based on existing
infrastructure. Complimenting mobile WiMAX
network, KT already has a Wi-Fi network covering
densely populated hotspot areas, and a subsidiary
company KTF (Korea Telecom Freetel) providing
nationwide 2G/3G networks. Through these
networks and multiple technologies together, KT
provides seamless data services for subscribers across
the entire Korean market.
In response to market demand, KT is gradually
expanding its network capacity and, in the process,
has deployed many different types of repeaters.
For instance, optical fiber or RF repeaters are used
according to differences in coverage requirements with optical fiber repeaters being generally used in
the areas with weak signal strength such as buildings
or in areas without signal coverage.
BS equipment is mainly categorized into indoor/
outdoor BS and KT uses ASN gateway equipment
to manage connections. In terms of the NM system,
KT has different charging systems and charges
different rates according to subscription condition.
Following initial network deployment, KT
conducted tests and trial operations to assess
effectiveness. The average download and upload
29 JUN 2008 . ISSUE 41
throughput on the mobile WiMAX network was
greatly increased, compared with HSDPA network.
Wide variety of terminals
KT designed a diverse range of terminals to meet
varying needs. For the mass consumer market, KT
provides USB dongles for laptop users, and mobile
WiMAX embedded laptops. Also, to meet the
needs of those who want to bring one terminal, KT
developed compact multi-mode smart phone which
integrates CDMA and mobile WiMAX functions.
For vertical market, KT provides user devices with
special business application to each market segment.
Currently, the USB dongles have gained a
majority of the nationwide market share. Covering a
wide instance of use, KT is going to offer additional
mobile equipment and electronics products, such
as digital cameras, which are also embedded with
WiMAX chipset. These product applications fall into
three categories.
The first category is card equipment. During
soft commercialization in 2006, mobile WiMAX
PCMCIA card was first released. In 2007, three
types of external USB dongles were released.
The first was dual-mode supporting both mobile
WiMAX and HSDPA. The second was single-mode,
which supported only WiMAX. The last was also
dual-mode equipment, supporting mobile WiMAX
and Terrestrial DMB (T-DMB). In Korea, T-DMB
is a mobile TV service. All these products have
proven popular in the diverse Korean marketplace,
and continue to be evolved with the intent of
maintaining existing users while attracting new
subscribers and increasing overall use.
The second category of terminal includes the
smart phone and the PMP. Currently there are three
types of smart phones available. These are produced
by Samsung and LG. These products are triple-mode
equipment, supporting mobile WiMAX, CDMA,
and T-DMB. All three types of smart phone have
been commercially released.
Huawei Technologies
Subscribers access CDMA network to
make voice call or access mobile WiMAX
network to use WiBro services. The same
units allow broadcast TV through the
T-DMB system. The PMP with mobile
WiMAX chipset embedded is also dualmode equipment. It supports WiMAX
and T-DMB, enabling convenient web
browsing.
The third category of terminal is the
laptop or UMPC embedded with mobile
WiMAX chipset. Samsung has developed
mobile WiMAX embedded UMPC with
unique feature, such as foldaway keyboard.
Focusing on core services
WiBro services fall into three categories,
core services, competitive services, and
differentiated services. Core services
reinforce WiBro’s unique style of service
provision. KT ’s core services include
UGC, Web Mail, My Web, PC Control,
a n d Mu l t i - B o a rd s e r v i c e s . W h e n a
subscriber connects a cell phone or a PC
to the mobile WiMAX network, these
services become available.
•• UGC
The UGC service enables the subscriber
to upload personal video clips or photos
to the UGC portal. When the subscriber
enters the UGC interface, they can access
their personal contents on the typical
portal website, which is fully integrated
with the UGC.
•• Web Mail
This is an integrated e-mail management
service provided through smart phones.
KT integrated three portal websites that
are frequently used. Usually, when people
want to check all of their e-mails, they
might need to log in to different portal
websites using different accounts. With
the KT Web Mail service, multiple portal
websites are integrated into a smart phone,
so the subscriber just needs to click one
icon to check all mail. A list of the portal
websites, with sent and received mails is
displayed when the subscriber clicks on
the corresponding icon. Downloads and
queries become much easier.
•• My Web
T h e K T My We b s e r v i c e a l l o w s
subscribers to exchange information
through a fixed website. Users can view the
desired information without visiting every
URL. Target website destinations can be
preset and categorized. Then the subscriber
can click the icon of My Web to open each
website category page. After entering a
category, the subscriber can immediately
locate all the preset websites.
•• PC Control
The PC Control service integrates a
subscriber’s home PC, office PC, mobile
equipment, and network storage media
into a smart phone. Through the PC
controller, the subscriber can remotely edit
any document or play MP3 files.
•• Multi-Board
The Multi-Board service serves as
a h i g h - q u a l i t y, m u l t i - c h a n n e l , a n d
multimedia conference platform.
Subscribers can use smart phone to
participate in a video conference. What
really interests KT’s subscribers is the
ability to share web pages at the same
time, watch video clips together, or handle
business matters simultaneously.
•• Customized services
Some subscribers require customized
services, such as news, everyday
information, popular video clips, T-DMB
mobile TV, and portal websites. Back
in April of 2007 when these services
were newly launched, only around 5000
subscribers signed up. However, when
all commercial services were provided,
the subscriber numbers exploded. The
growth ratio was ten times greater than
experienced on launch of initial services.
As network coverage is improved, KT
anticipates an even faster increase in
subscriber numbers.
Flexible marketing strategies
With powerful products and a wide
variety of terminals, KT has developed
several killer applications and binding
products. Price: The current pricing strategy
is a partial flat rate that can be widely
accepted. Promotion: KT has conducted
various promotional activities with varied
orientation. For example, college students
are major customers, so KT has conducted
student-specific price plan. KT has also
conducted joint promotional activities
together with the company’s commercial
partners. Last, but not least, are distribution
channels. Sales distribution for KT ’s
products is performed through its subsidiary
companies, dedicated channels, and online
tools.
KT provides four levels of standard
prices for the partial flat-rate subscribers. It
also provides two service packages, namely
the Saver and the Free packages to spur
the development of WiMAX service. As
mentioned earlier, The Saver package costs
only USD10 for up to 1GB. In addition,
for Saver subscribers who require large
throughputs, KT provides the Fun, UGC,
and Life packages. For an additional
three dollars, subscribers can enjoy all
of the three content packages without
limitation or impacting the 1GB already
purchased. The promotional price of the
Free package is no more than USD20, and
the promotion runs until the end of 2008.
KT also provides WiBro+Megapass
(Fixed Broadband) and WiBro+Show
(WCDMA) package products.
WiBro+Megapass is a package consisting
of mobile and fixed broadband services.
KT’s broadband fixed services have over
50% of the domestic market share, making
KT the leading operator in Korea. These
two package products afford major price
advantages.
Communicate anywhere
The vision of KT is to be a market leader
in the Mobile 2.0 era and provide advanced
broadband rich service for subscribers so
that they can communicate, not only when
in one place, but also when they are on the
move. It is also KT’s goal for subscribers to
be able to enjoy real-time and personalized
broadcasts created by other remote users.
Ultimately, KT believes Korea’s WiBro
service is providing good examples and
business cases to help operators build a
world with networks everywhere, allowing
people to access the Internet anywhere,
anytime, and through any terminal.
Editor: Xue Hua xuehua@huawei.com
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