‘‘s Broadband Strategys Broadband Strategy

InsungInsung Jun, Ph.D.Jun, Ph.D.Vice PresidentVice PresidentNetwork Engineering CenterNetwork Engineering CenterKT Corp.KT Corp.

December 2003December 2003

xDSLxDSL & NGN& NGN

2

ContentsContents

KT Vision & Strategy

Converged Services

Global Leader: KT

3

Global Leader: KTGlobal Leader: KT

4

Where Korea StandsWhere Korea Stands

Korea’s Information Society Ranking

Source: IDC(Int’l Data Corporation)

16161616

1818181819191919

22222222202020202222222222222222

23232323

0000

5555

10101010

15151515

20202020

25252525

'95'95'95'95 '96'96'96'96 '97'97'97'97 '98'98'98'98 '99'99'99'99 '00'00'00'00 '01'01'01'01 '02'02'02'02

Broadband Penetration Level by Country

0000 1111 2222 3333 4444 5555 6666 7777

Finland

Canada

Korea. Rep.

Singapore

U.S.A

Sweden

Belgium

Austria

Germany

Hong Kong

Iceland

U.K

Netherland

Denmark

Panama

Source: WEF(World Economic Forum), ‘Global Information Technology Report 2002~2003: Readiness for the Networked World’

5

Broadband penetration in OECD countriesBroadband penetration in OECD countriesBroadband penetration in OECD countriesBroadband penetration in OECD countries

Source: OECD

19% (June.2002)19% (June.2002)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

Korea

Canada

Swede

n Denm

ark

Belgium

United

States

Ice

land

Austria

Jap

anNeth

erland

s Sw

itzerla

nd Germ

any

Norway

Fin

land

Spain

Fra

nce

Portu

gal

Australi

a

United

Kingdo

m Ita

ly New

Zeala

nd Luxe

mbourg

Hungary

Czech R

epubli

c Mexi

co

Irelan

d Po

land

Turkey

Subscribers to other broadband platforms, June2002

Cable Modem Subscribers Per 100 Inhabitants,June 2002

DSL Subscribers per 100 inhabitants, June 2002

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Traffics of Major KT ServicesTraffics of Major KT Services

0.E+00

1.E+09

2.E+09

3.E+09

4.E+09

5.E+09

6.E+09

7.E+09

1998

1999

2000

2001

Local call Long distance call

International call LM call

ML call

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Broadband Market Share in Korea Broadband Market Share in Korea

49.149.149.149.1

47.347.347.347.3

26.526.526.526.5

27.627.627.627.6

16.816.816.816.8

12.512.512.512.5

2.32.32.32.3

1.61.61.61.6

1.61.61.61.6

1.41.41.41.4

3.13.13.13.1

4.34.34.34.3

0000 20202020 40404040 60606060 80808080 100100100100

2001200120012001

2002200220022002

KT Hanaro Thrunet Dreamline Dacom SKT Onse

Source: MIC

(%)

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Broadband Market Share TrendsBroadband Market Share Trends

2000

4000

6000

8000

10000

12000

1999 2000 2001 2002 2003 2004 2005 2006

(Unit : thousand)(Unit : thousand)

4,018

7,863

13,500

32514

10,00010,000

CATV : 37%

ISDN : 1%

xDSL : 62%(+LAN)

Oct. 2002Oct. 2002

14000

Jan. 2003Jan. 2003

KT (5,053)

Hanaro(2,896)

Thrunet (1,300)

Others (1324)

10,57310,573

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History of KT Broadband Business History of KT Broadband Business

1997- First Trial Service

Sep. 2000 –Number of Subscriber Exceed 1million

Jun. 1999 – Commercial Service Launched

Jun. 2000 – Biggest Market Share in the Nation

Jan. 2003 Jan. 2003 --Number of Number of Subscriber Subscriber

Exceed 5millionExceed 5millionJan. 2002 – Wireless LAN“Nespot” Launched

May. 2002 –VDSL Service Launched

Apr. 1999 - Competitor HanaroLaunched Its ADSL Service

Jun. 1998 – Competitor ThrunetLaunched Its Commercial Service

Sep. 1998 - Second Trial Service

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Key Success Factors Key Success Factors

• Urban GeographyUrban Geography•• CompetitionCompetition•• Government SupportGovernment Support•• EquipmentEquipment•• MentalityMentality

External FactorsExternal Factors Internal FactorsInternal Factors• Aggressive Aggressive

Marketing StrategyMarketing Strategy•• Stable NetworkStable Network•• Systematic Systematic

Management Support Management Support System System

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Converged ServicesConverged Services

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Convergence is Convergence is Inevitable PhenomenonInevitable Phenomenon

IT products

Home Theater

X box

Play Station2

Package products

PackagePC+Printer+Scanner…

Converged ServiceNew car Sales+

Old car scrapping

Financial products

Total Asset Mgmt

Private Banking

Integrated Financial Product

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What Triggers Convergence?What Triggers Convergence?

Customer Needs

Multi-Function

Convenience

Affordable Price

Development of Technology: Digitalization

Product Convergence

Marketing Convergence

Network Convergence

Device Convergence

Content Convergence

Media Convergence

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KTKT’’ss Service Evolution Phases Service Evolution Phases

ADSL

VDSL

NESPOT

Sep. 2000: Number of Subscriber Exceed 1 MillionJun. 1999: Commercial Service Launched

Jan. 2002: Service Launched

May. 2002: Service Launched

xDSL

Telephone

NGN

May. 1997: The Number of Telephone Subscribers Exceed 20 Million

Oct. 1988: The Number of Telephone Subscribers Exceed 10 Million

Jan. 2003: Number of Subscriber Exceed 5 Million

Home Digital Service

DMB

2.3GHz

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KT WLAN: NESPOTKT WLAN: NESPOT

BusinessObjective

•To Meet an Ever-growing Needs for Mobile Internet Service•To Develop ‘front-end service’ by Combining Widespread Broadband and Wireless Solutions

Target Market

Hot Spot•About 18,000 Hot Spots is available in Korea•25,000 Hot Spots accessible through the global roaming by the end of 2003

Service Launch March, 2002

No. of Subscribers 293,000 as of Aug. 2003

Residential Customer, Enterprise Customers, Travelers

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Public WLAN Positioning

CDMA/Phone

Megapass

PC

Mobility

Speed

Students at home

WEB

PC

high

Home, Office

MegapassMegapass

Ordinary

Voice, Short Message

Phone, PDA

slow

Wide area

CDMACDMA

Students on Campus

Businessman at Hotel, etc

Customers

E-book, VOD, AOD,

POP3 Mail, Messenger

Application

PDA, NotebookTerminals

highThroughput

Hot spots

Wireless LANWireless LAN

Coverage

Stationary MobileQuasi-

W-LAN

PDA

10Mbps

2Mbps

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Digital Life Digital Life -- Home Digital ServiceHome Digital Service

TotalSolution

InteractivePlatform

Commerce

ApplicationService

Platform Service HDS Platform

Partners HDS Platform Customer

Application ServicePartners

Commerce Partners

Advertising Partners

CustomizedH-CRM

BrandCollaboration

PCS

Vehicle

Advertising

BroadcastingEntertainment

Communications

Electric application

Security

Gateway

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Digital Multimedia BroadcastingDigital Multimedia Broadcasting

InternetCall Center

distribution channel

Repeater for poor

reception (Gap Filler)

Seeing & hearing By portable handsets

Log-in/Registration

Cellular/Portable internet network

Contents(Audio,Video,data)

Seeing & hearing by vehicle mounted terminals

DMB Transmission center(Digital Multimedia Broadcasting)

Ku-Band

Ku-Band

S-Band13.824 ~ 13.883㎓㎓㎓㎓

KT 2.605 ~ 2.630GHz

*SKT 2.630 ~ 2.655㎓㎓㎓㎓

12.21~ 12.23㎓㎓㎓㎓

Mobile IP

DMB Center

S-Band

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KT Vision & StrategyKT Vision & Strategy

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Strategic Direction of KTStrategic Direction of KT

Wired/WirelessWired/Wireless4G Network4G Network

FixedFixed--MobileMobileContentContent

Multi FunctionalMulti FunctionalDeviceDevice

NOWCConvergenceonvergence CContent & Solutionontent & Solution

CCoverageoverage

Future

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Next Generation NetworkNext Generation Network

TodaySingle-service Network

Servers

Clients

Backbone Network

AccessAccess

NGNMulti-service NW/client-server

Communication Control

Content Content

Access

Dat

a/IP

Net

wor

ks

PLM

N

PSTN

/ISD

N

CA

TV

Services

Access Transport & Switching Networks

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KT’s NGN Evolution Roadmap

Roadmap

. Provide QoSIP-basedVoP service

. Expand VoP(Increase supply of SSW)

. Expand application service base

. Introduce trunk G/W

. Introduce soft switch (Class 4, 5)

. Build packet backbone network

. Introduce Access G/W

. Replace semi-electronic switching systems

. Develop/evaluate SSW

. Build packet backbone netwrok

MajorActionItem

2007 ~2006200520042003~ 2002

Stage 3Stage 2Stage 1Preliminary StageStage

NGN Foundation

VoIP(H.323/SIP)

NGN Completion

VoPOver QoS IP

NGN Migration & Expansion

Access G/W(v5.2)

Open IN Service

Trunk G/W

Softswitch(Class 4, 5)VoIP(MEGACO)

IP-based IN Service

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Ubiquitous WorldUbiquitous World

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Converged Broadband Services on Converged Broadband Services on NGN Will Guarantee NGN Will Guarantee KTKT’’ss Continuous Continuous Lead in Global IT IndustryLead in Global IT Industry

Thank you!Thank you!