Operator Source:More InformationSubscribe

South Korea Broadband Overview

South Korea has one of the highest broadband penetration rates worldwide, has long been one of the most advanced broadband markets in the world and is a world leader in the deployment of FTTx. One of the reasons behind this phenomenon is that South Korea established a robust national broadband development strategy which received widespread political support. The government adopted an initiative known as the Korea Information Infrastructure (KII) Plan. The details of which include enabling the connection of 84 per cent of South Korean households to broadband services with speeds up to 1 Mbps by 2005. The government subsidy of equipment purchases, consistent deregulation and the implementation of market principles, led to South Korea possessing one of the most liberalised telecommunications markets in Asia.

The South Korean government also deployed two other development programmes, the Broadband Convergence Network (BcN) and IT839. Both of these focus on creating a ubiquitous network which enables customers to communicate anytime through a variety of devices, including fixed and mobile phones, personal computers, home networks and other appliances. In 2004 the government selected three consortia led by Korea Telecom (KT), DACOM and South Korea Telecom (SKT) to develop trial BcNs using their own funding. This request was facilitated by the close relationship between the government and the telecommunications industry and the fact that the government was a major stakeholder in the incumbent KT (formerly Korea Telecom).

The government’s emphasis on backbone networks as the foundation of its broadband strategy led to broadband development in rural areas by using an existing government-funded broadband network (KIIPublic). This reduced costs for broadband providers who could reach subscribers in rural areas without having to build their own network infrastructure. In addition, under “Cyber Korea 21” the government required KT to provide Internet access to rural areas at a minimum 1.5 Mbps speed by 2002. As a condition of privatisation, KT is legally required to provide a universal service, including a requirement to provide broadband access to rural areas.

Home users drive most of the broadband demand in South Korea. This is particularly advantageous for DSL services since more than 93 per cent of homes are within a 4 km radius from local exchanges and within this range DSL broadband services are most effective. As a result, DSL services are very popular in South Korea.

KT (privatised in July 2002) is the incumbent telecommunications operator. It is the largest provider of ADSL services in the world and the major nationwide local call service carrier in South Korea. KT launched full ADSL service in June 1999. In October 2005, it launched BcN (Broadband convergence network) service for commercial use.

The main mobile operators in South Korea are SK Telecom, Korea Telecom Freetel (KTF) and LG Telecom with market shares totaling 50 per cent, 32 per cent and 17 per cent respectively. SK Telecom is the main player in the South Korean wireless market with over 22 million subscribers and 50 per cent of the South Korean mobile market at end 2007. SK one of the first mobile operators to launch commercial services which use CDMA, CDMA 2000x1, CDMA EV-DO and HSDPA networks and provides wireless Internet and mobile multimedia services.

KTF is the second largest mobile operator in the country with 14.2 million subscribers at the end of 2007 and a 32 per cent market share (approximately). The main shareholders in KTF are South Korean incumbent KT (53 per cent) and NTT DoCoMo (10 per cent). KTF has a commercial 3G synchronized service and a CDMA 2000 1X EV DO service which can be used anywhere in the world. LG Telecom is the third largest mobile carrier with 8.1 million subscribers and a 17 per cent market share.

LG was reported as the fastest growing mobile operator in Q2 2008 and launched an open, full-browsing Internet service, known as Oz service in April 2008. The service is the cheapest data service option for South Korean mobile subscribers by far and LG hopes that its service will stand out as a result of its aggressive pricing policy.