Wireless Broadband in Korea-part 1


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  • SCE: Service Control Environment (DB) SCP: Service Control Point (intelligence NW for services using DB, i.e. Caller ID service, membership discount, etc.) BTS : Base Transceiver Station BSC: Base Station Controller (terminal authentication occurs here) VMS: Voice Messaging System PDSN : Packet Data Service Node (for packet NW including) HA : Home Agent IWF : Inter Working Function HLR : Home Location Register VLR : Visitor Location Register MSC: Mobile Switching Center
  • @ Finpro ry LG Telecom never has EVDO network.
  • @ Finpro ry
  • Targeted annual turnover for 2005 : 10 Trillion KRW. Various new applications such as MelOn (music service), mobile cyworld (community service), Cizel (movie service), GXG (mobile game), convergence of online and mobile services, and flexible pricing program vitalized mobile internet usage. MOU : average voice call time per month
  • @ Finpro ry As of September 2005, 42.8% of mobile phone owners aged 12 years or over have used the mobile internet at least once within the previous 6 months. The percentage of mobile internet users is the highest among mobile phone owners aged 12~19 years(87%) followed by 20’s(73.1%) and 30’s(42.7%). Users access to the mobile internet for 52.3 minutes and 6.5 times a week on the average and spend 5.7 EUR/month for accessing the mobile internet, which is 12.2% of the total spending for mobile phone use a month. Most popular mobile internet contents are ringtone/melody download(96.8%), music(45.4%), image download/transmission(42.1%), and game(37.1%). The most popular pricing program for the mobile internet use is ‘time-based charge’ system followed by fixed charge’ and ‘accessed-based charge’ system. Over 70 % of mobile internet users have purchased services and goods through the mobile internet. In 2004, 69.8% of wireless internet users connected to the wireless internet less than 5 times per week. And all wireless internet users access to it 4.9 times a week on the average.
  • @ Finpro ry In 2004, data sales accounted for 19% of the total mobile service sales while the revenue from voice service stood at the remaining 81%. Data sales is expected to continue growing and reach 30% of the total mobile service by 2008. There is a trend toward more data usage if subscribers own advanced multimedia handsets. Mobile operators’ mobile internet sales out of total non-voice sales were 51%(SKT), 64%(KTF), and 36%(LGT) respectively in 2Q 2005. Ratio of mobile internet sales is likely to increase when 3G services with fast data transmission speed fully deploys in 2006. Non-voice services means airtime , SMS, per-download charge, and v alue-added services including CID and ringback-tone service
  • @ Finpro ry
  • Mobile phone sales in the domestic market amounted to 15.9 million units in 2004 and is estimated to reach 13 ~ 16 million in 2005. Camera phones took more than 70% of the total sales, and the market was divided by Samsung, LG, and Pantech with the market share of 50%, 25%, and 15% respectively. Mobile handset production in Korea is more sensitive to overseas demand than domestic demand. Domestic sales accounts for only around 10% of the total production in the country and 90% for overseas sales. Please note the discrepancy in figures between Table 6 and 7. MIC figure is much less than National Statistics figure. Mostly MIC figure is used.
  • @ Finpro ry Three major manufacturers, Samsung Electronics, LG Electronics, and Pantech & Curitel, are controlling 80% of the mobile handset market in Korea.
  • EVDO : Evolution Data Only. CDMA 1x EV-DO, called also HDR (High Data Rate), is a synchronous IMT2000 technology which has upgraded the data processing speed of CDMA2000 1x (IS95C) technology to 2.4Mbps at the maximum. EV(Evolution) means the evolution from CDMA20000 1x, and DO(Data Only) means that only data processing and transmission speed has been upgraded. CDMA EVDO is Phase 1 and its specifications have been fixed and commercially deployed in Korea. Phase 2 is EVDO.
  • ANTS: Access Network Transceiver Station ANC : Access Network Controller BSC: Base Station Controller AN AAA : Terminal authentication server DRL : Daytime Running Light
  • Wibro follows 802.16e standards. Wibro is expected to overcome non-mobility of fixed broadband, low speed and high price of mobile internet, and low coverage of WLAN.
  • License fee for Wibro Operators : KT - 125.8 bil KRW(100 mil Euro), SKT – 117 bil KRW (93 mil EUR)
  • Initial business model is a fee for internet access to mobile internet, WLAN, and fixed broadband internet. When the market it ready, value-added service will be developed for revenue generation. Initial business model is a fee for internet access to mobile internet, WLAN, and fixed broadband internet. When the market it ready, value-added service will be developed for revenue generation.
  • Although KT has its subsidiary ‘KTF’ that is a mobile operator, KT itself dose not have a mobile business other than WLAN business. In order to cope with the convergence era, KT has been eager to enter the mobile business. Wibro is seen as a means to give a mobile wing to KT, which is why KT considers it an essential for its future business.
  • SKT plans to adopt IPv6 over Wibro, but investment on that will start from 2006, aiming to achieve 30Mbps in the beginning – 50Mbps by 2008 – 100Mbps by 2010.
  • It takes 40 seconds to send 1MB MM over the mobile NW while it takes only 8 seconds over Wibro. To download a 4MB (1 packet=50byte) MP3 over the current mobile NW, it costs 120000KRW (100 EUR). SKT sees HSDPA more important than Wibro as ;HSDPA is easier to realize mobile TPS, cheaper for NW investment, and users prefer a mobile phone type terminal. Mobile phone type terminal is preferred. Due to price and mobility, users are not likely to buy two handsets for similar services. HSDPA can offer nationwide voice and data services, and therefore is likely to be preferred by users. Once selected, a handset has a lock-in effect.
  • SKT’s june/Nate on CDMA network, its satellite DMB through TU Media, Wibro, and HSDPA all offer mobile TV service. SK Networks is in charge of handset distribution of SK Telecom. SK Communications and Widerthan.com are contents and solution providers.
  • Commercially launched in Feb. 2002, NESPOT is a Wi-Fi (IEEE 802.11b) wireless internet service provided by KT in the area where Access Points are installed through laptop or PDA equipped with wireless LAN card and a free software provided by KT. KT has about 15,000 hotspots across the country. Two ways of connecting to the internet via NESPOT : (1) Connection through ID and Password (2) Connection through MAC (direct connection by insertion of wireless LAN card) Subscriber in the chart includes corporate customers.
  • Korean companies own many IPRs in H.264 (MPEG4 Part 10 AVC) and MPEG4 BSAC. BSAC, developed by Samsung Electronics, guarantees 96kbps, a CD-quality audio. Eureka 147 is based on OFDM (Orthogonal Frequency Division Multiplex) for transmission technology. System E was developed by Toshiba. System E is based on CDM (Code Division Multiplex) for transmission technology. 6 Terrestrial Operators : KBS, MBC, SBS, YTN Consortium, KMMB Consortium, Korea DMB Consortium Terrestrial DMB is a existing broadcasters-driven service and was born as an extension of existing terrestrial TV service. 1 Satellite Operator: TU Media (SK Telecom’s affiliate company) is the satellite DMB N/W and service operator. http://www.tu4u.com/main.jsp Satellite DMB is a mobile operator-driven new service and was born to create new ARPU source.
  • SK Telecom’s satellite is for 135, 144, 154 degree, longitude. KT’s satellite is for 113 degree, longitude.
  • TU offered free of charge trial service from Jan. to April.
  • Programs are sent from the Broadcasting Center to the Satellite using Ku Band. The Satellite sends the received contents to terminals on earth such as PDA or mobile phone using S Band. In case there are shadow areas that hinders signals, signals are sent to Gap Fillers on earth using Ku Band, and then Gap Fillers sends signals to end users’ terminal using S Band.
  • SkyTeletech is buying DMB baseband chip from LG Electronics and Toshiba. Pantech and Curitel is buying the chip from TelAce. SkyTeletech’s DMB mobile phone IMB-1000 adopted Toshiba’s baseband chip, but its following model will adopt LG’s.
  • IDC 2100 & IDC 1000 by INNOACE HDMB 1000 by Hyundai Digital Tech HN3000 by ChoongAng System
  • Alticast and Air Code (both Korean companies) are developing solutions solutions to be ported on the terminal and broadcasting server for future data service over satellite DMB. Together with ETRI and SK Telecom, the two companies are developing standards for data service for satellite DMB. Alticast supplied middleware platform for MHP satellite broadcasting service and OCAP cable digital TV.
  • 6 operators do not have terminal distribution channel yet and are unsure how to build the network. MIC and the 6 operators want the three mobile operators to distribute the terminal, but the mobile operators do not see the merits of doing so. Mobile operators have know-how to build Gap Fillers and also have spaces to install them, which terrestrial DMB operators lack. While mobile operators want charged service for terrestrial DMB, terrestrial DMB operators (their trade unions in specific) insist on free of charge service. From mobile operators’ point of view, revenue comes from subscription fee. From terrestrial DMB operators’ point of view, revenue comes from advertising fee of enterprises.
  • MOT: Multimedie Object Transfer. MOT is a protocol that enables file transfer and replay of the received file. IP Tunneling is an IP-based data transfer technology. IP-based data transfer on the Web can be done over the broadcasting network (terrestrial DMB network) using IP Tunneling technology. Using MOT and IP Tunneling, new dimensions of data broadcasting is possible through terrestrial DMB. For example, lyrics of songs being heard over the terrestrial DMB can be sent in text file to the user terminal simultaneously. Pictures of singers can be shown in Slide Show, as well.
  • Samsung and Nortel have supplied 900 BSTs to SKT during 1H 2005 Targeted coverage within 2005 are 23 cities by SKT and 17 cities by KTF. SKT’s CDMA network is based on 800MHz while KTF and LGT’s are on 1.8GHz. WCDMA and EVDV are on 2GHz bandwidth. Therefore, DMDB handsets that guarantee interoperability between WCDMA and CDMA must be released in order to allow WCDMA to work nationwide. SKT’s target was to gain 200,000 subscribers by the end of 2005 while KTF targeted 50,000 subscribers, which all failed.
  • @ Finpro ry
  • Samsung Electronics’ demonstration on HSDPA system and terminal during Cebit 2005 showed 1.8Mbps. HSDPA is a software upgrade on WCDMA. When HSDPA is adopted, mobile TPS (triple play service) can be enable.
  • SKT has signed an agreement with Hanaro Telecom to cooperation for WLAN service. PSTN-based fixed telephony can be changed to WLAN-based VoIP giving an access to the Internet. In outdoors, CDMA or HSDPA network is used for data service. Commercialization is planned for Q2 2006. KT plans to apply WLAN to Home Network devices.
  • UWB is a new wireless transmission technology taking over 1.5GHz bandwidth, resulting in 500Mbps~1Gbps broadband transmission speed. Power consumption of UWB is only 1/100 of mobile phone and WLAN. ETRI (Electronic and Telecommunications Research Institute) is a leading State-funded R&D agency in the electronics. SAIT (Samsung Advanced Institution of Technology) is the central R&D Center of Samsung Electronics working on mid-to-long term future technologies. UWB is one of the core technologies for Home Network along with Zigbee and RFID.
  • Global UWB market is expected to increase from 188 million USD in 2004 to 1,385 million USD in 2007.
  • Samsung’s Sense X20 uses AirGo Networks MIMO chip.
  • TTA (Telecommunications Technology Association) is a State-funded Association that establishes and provides technical standards in collaboration with companies, research institutions, and academia. It sets up plans for standardization, establish standards, and tests & certifies standard products.
  • Budget of government-funded research institutes increased to 2,113.9 billion KRW (1,678) in 2004 from 1,094.1 billion KRW (8,683) in 1998. The substantial growth mainly comes from the increase in government’s R&D projects, which showed a 114% growth from 1998 to 2004. Especially, portion of government-commissioned R&D projects leaped by 167.9% during the period. Research staff of the government-funded research institutes have expanded from 6,081 people to 8,023 people during the period. Budget for public R&D in 2006 will increase by 15% from 2005.
  • In 2005, The Korean government analysed the 10 mega public R&D projects in which investment of over 100 billion KRW was put since 1989. The conclusion is that 7 of the 10 were success while the rest (Techno Park, Environmental Engineering, and Civil-Military Technology) could have been done better. The analysis suggests that the investment of 2.1 bil EUR poured in from 1989 until 2004 will have 314 trillion KRW (249 bil EUR) worth of economic rippling effect by 2010.
  • ETRI has 1800 R&D staff with master and Ph.D degree. ETRI has about 13000 patents of which 3000 are international patents. It earns 365 billion KRW per year from technical license. ETRI’s main commercialization focus for 2005 lies in DMB and Wibro. ETRI aims to function as national CTO.
  • - Samsung Group will invest 47 trillion KRW (37 bil EUR) in R&D for 5 years until 2010 with an aim to create 50 world-best products and 70 billion USD worth of brand power and generate 30 trillion KRW (24 bil EUR) of before-tax-profit. - Samsung Group’s selected next generation growth engine : large capacity memory, next generation display, mobile communications, digital TV, next generation printer, System LSI, next generation mass storage, Air control system, Energy, Light source, high-value ships, precision optical machines, electronic materials. - For this, Samsung will hire 6000 new R&D staff each year. On top of the 47 trillion KRW for R&D, Samsung will invest 4 trillion KRW for industry-university joint R&D and 1.2 trillion KRW for supporting suppliers. - Intel Korea R&D Center was recently set up - Motorola announced it would set up its R&D Center in Korea - Korean government is making great efforts to attract foreign R&D Centers in the high IT technology
  • MIC announced in January 2005 that it will expedite the development and international standardization activities of CR (Cognitive Radio) and SDR (Software Defined Radio)
  • CR can analyze spectrum environment and find optimal spectrum so that optimal spectrum can be automatically used. Also it can switch between CDMA and GSM. SDR has the same function as CR. CR is a Hardware technology while SDR is a Software technology When CR and SDR are realized, one terminal can work both in CDMA and GSM network, and the terminal can find the optimal spectrum on various bandwidth such as 800MHz, 900MHz, or 1.8GHz for itself. HY-SDR Center is world-reputed R&D center in SDR technology.
  • Killer applications in 2004 were more sophisticated ring tones (music), characters, and games. Downloading MP3 music files through wire-wireless converged portals gained popularity. Out of the total mobile subscribers, actual users of mobile internet are only 14 million. How to induce the rest, mostly composed of over age 40s, to use the mobile internet is the key to more revenue generation. Telematic and mobile banking are the new services they can use. Voice call has reached saturation. Operators are focusing on new non-voice services to sustain growth. Despite the success of mobile internet service in Korea, only a few top mobile Content Providers are successful and taking the fair share of the growing pie. 7.4% of the total CPs have more than 2 billion KRW (1.4 million EUR) of annual turnover. About 81% of the total CPs have not reached break-even yet. There are over 1,300 CPs competing in the market. 67% of the total CPs are employing less than 20 people. 70% of the total CPs have less than 500 million KRW (400,000 EUR) of paid-in-capital. SKT has 4,670 menus and 680,000 contents in its mobile internet service.
  • Most popular mobile internet contents are ring tone/melody download(96.8%), followed by music(45.4%), picture download/transmission(42.1%), and game(37.1%).
  • @ Finpro ry Mobile finance service launched by SKT and KTF in 2001 has not been very successful in Korea until mobile banking service hit the market. The first form was a mobile payment service through credit card built in handsets. LG Telecom, the country's third-largest mobile carrier, sparked the race for mobile financial services late last year, expanding its user base with Bank On, a full mobile banking solution for Kookmin Bank customers. LG, which has long faced an uphill battle to compete with its bigger rivals, benefited from the mobile banking service after staging joint marketing campaigns with Kookmin, the country's largest lender. IC chip based mobile finance service or mobile banking service was introduced in Korea in 2003. As of September 2005, 85.7% of mobile internet users are aware of mobile banking service while only 8.4% of those actually use the service. (Source: NIDA)
  • @ Finpro ry
  • Mobile operators revenue from CID and SMS between 2001 and 1H 2005 marked 1,825 million EUR (from CID: 899.7 million EUR / from SMS: 968.5 million EUR). The revenue is divided to 1,031 million EUR, 529 million EUR, and 300 million EUR by SKT, KTF, and LGT respectively.
  • @ Finpro ry SKT’s multimedia music service, MelOn, lets user to download music files an play on mobile handset, PC and MP3 players as long as subscription with monthly flat fee is valid. Due to development of mobile network and handset, more sophisticated wireless internet services with improved functions are in demand. Entertainment services are leading the trend. Users can not only listen to music but also download ring tone/ ringback tone and tailor-made music anytime through music portals both under wired and wireless conditions. Ring back tone was introduced by SKT in March 2002 with a brand name “Color Ring”. LGT and KTF joined the lucrative business in July and October 2002. SKT’s sales from ring tone service is divided 70% to 30% between MIDI tones and MP3 tones. MIDI: Music Instrument Digital Interface
  • @ Finpro ry Mobile game is a major killer application in the wireless internet contents market. Mobile game genres are RPG, Tycoon, sports, puzzle & board, action/arcade/shooting. More than 33 million handsets capable of playing mobile games have been distributed in the Korean market. According to SKT, mobile game was for killing time outdoor in the past. But, it is now more used indoor to enjoy the game itself
  • @ Finpro ry The first multimedia content introduced in Korea was black & white animation for the mobile phone screens in May 2000 and its market began to greatly expand thanks to wireless internet-capable handsets with color LCD in 2001. Currently available moving image contents such as movie, soap opera, TV entertainment program, music video, education program, movie preview, and concert hoop-up can be executed only through EV-DO phones.
  • @ Finpro ry Current trend of celebrity nude collections was a driving force behind the rapid growth of the mobile adult contents market emerging as an important revenue source even to many CPs whose core business was not adult contents. Data fee for using moving image is still too high.
  • @ Finpro ry Telematics market is divided to ‘before market’ and ‘after market’. Major players in the before market are SKT, TU Media, Renault Samsung Motors, LGT, Hyundai-Kia Motors, KTF, and Ssangyong Motor while SKT, SK, Samsung Electronics, KTF and LGT are competing in the aftermarket. Telematics services : Navigation, Traffic info, Theft prevention, Location tracking,Remote control, Remote diagnostic, Mobile internet, etc. Pricing : Fixed monthly fee + info usage fee
  • KISDI : Korea Information Strategy Development Institute serves as an advisory role on national initiatives for the construction of an advanced information society. It contributes to the development of Korea’s IT policies. KCC : Korea Communications Commission. The Korea Communications Commission (KCC) is an independent regulatory agency. Established by the Article 37 of Telecommunications Basic Act, it is charged with deliberating issues concerning fair competition environments and consumer protection of telecommunication services, and with arbitrating disputes among telecommunication service carriers and between users and carriers.
  • BcN is a next generation network converging communications, broadcasting, and internet while offering QoS broadband multimedia service and enhanced security at the transmission speed of 50 to 100Mbps. The Korean government announced in November 2003 that the government and the private sector would make an advance investment of 2 trillion KRW and eventually induce 67 trillion KRW of private investment in the BcN-related business between 2004 and 2010. Trial service over the BcN was launched in some parts of a few metropolitan areas in 2005.
  • The standard specification was drafted in lieu of the platform requirements jointly drafted by the three carriers on September 4, 2002 WIPI : Wireless Internet Platform for Interoperability From April 2005, all new mobile handsets are required to port WIPI. As of January, 2005, mobile operators sold about 1 million WIPI-ported mobile handsets in 47 models. Proprietary platform such as GNEX (upgraded version of SKVM and GVM) and BREW will be used along with WIPI. As of January, 2005, about 17.5 million mobile phones are ported with GVM/GNEX, which is about 48% of the domestic mobile phone market. Of the 17.5 million, 25% is ported with GNEX. There are about 50,000 contents that work on GVM/GNEX.
  • GNEX Application Manager manages contents downloaded on GENEX-ported system, loads the contents in the Memory, and activates GNEX Virtual Machine to execute loaded contents. It also transfers system events that are delivered by Event Handler to GNEX contents. GNEX Virtual Machine interprets and activates GNEX contents. GNEX Virtual Machines is optimized to run games and multimedia contents. GNEX Kernel provides various system interfaces. GNEX Event Handler receives and processes Event that is delivered from system. GNEX Device Driver functions as an interface between GNEX module and system. It includes terminal-related interfaces for Memory Management, LCD Display, Audio/Vibrator Control, System Information, Screen-saver/Ring-tone, File System, Socket, Voice Call, SMS, Browser, Serial Communication, VOD/Camera Control, Phone Book/History, Phone Image Control, etc.
  • As of October 2004, 7 models of KTF, 10 models of SKT, and 2 models of LGT have ported WIPI on their handsets, aiming to increase the number to 50 by the yearend for three operators.
  • Dica : Digital Camera DiCam : Digital Camcorder PnP : Plug and Play
  • Along with the small & light handset trend, internal antenna or intenna including ceramic chip antenna and DRA (Dielectric Resonator Antenna) are gaining the market.
  • Megapixel image sensor is becoming the mainstream of camera phone image sensor technology replacing CIF and VGA image sensors, which were main features in 2002 and 2004 respectively. The ratio of VGA to the total image sensor market was 75% in 2004. After Pixelplus, SiliconFile also started exporting CMOS Image Sensors to the Asian market including Japan, China, and Taiwan. Megapixel camera module manufactures: Samsung Electro-Mechanics and Sunyang DNT, Samsung Electronics introduced Korea’s first camera phone 100,000 pixel CMOS module installed in 2000. PD-6000 with 330,000 pixel CMOS camera module by Pantech and Curitel brought so-called ‘camera phone era” to the country in October 2002. Megapixel mobile phones have been produced by Japanese and Korean companies since the second half of 2003. Major Korean mobile phone makes, Samsung, LG, and Pantech, started producing 3 megapixel handsets in July 2004 and Samsung came to introduce 5 megapixel camera phones at the end of 2004.
  • ‘ One Phone’ is a new service offered by KT. While at home call to mobile phone is switched to fixed telephony. ‘ NESPOT Swing’ is a WLAN+CDMA converged WLAN service offered by KT. When WLAN AP is not available, CDMA network is used. VoIP over WLAN service will be commercially available by the yearend by Korean telcos. Enterprise customers are interested. Samsung and LG Electronics started to develop a UMA(Unlicensed Mobile Access) terminal that supports multimedia network between GSM and WLAN. UMA terminal supports seamless roaming between mobile phone and WLAN. Commercialization is expected happen early 2006.
  • Edge router is a system that enables network convergence and converged multimedia services over BcN. Cisco, Juniper, Laurel Networks are major suppliers.
  • Wireless Broadband in Korea-part 1

    1. 1. Wireless Broadband In Korea for GIGA Technology Program YM Kim Finpro Korea November 15, 2005
    2. 2. Table of Contents <ul><li>Introduction </li></ul><ul><li>Overview of the Market </li></ul><ul><li>2.1 Mobile Network Evolution </li></ul><ul><li>2.2 Mobile Subscribers </li></ul><ul><li>2.3 Mobile Operators </li></ul><ul><li>2.4 Mobile Internet </li></ul><ul><li>2.5 Mobile Phones </li></ul><ul><li>Network Technology </li></ul><ul><li>3.1 CDMA2000 EVDO </li></ul><ul><li>3.2 Wibro </li></ul><ul><li>3.3 DMB </li></ul><ul><li>3.4 3G : CDMA2000 EVDV, WCDMA, HSDPA </li></ul><ul><li>3.5 WLAN </li></ul><ul><li>Future Technology </li></ul><ul><li>4.1 4G </li></ul><ul><li>4.2 UWB </li></ul><ul><li>4.3 MIMO </li></ul><ul><li>4.4 Hand Over Issue </li></ul><ul><li>R&D </li></ul><ul><li>5.1 Public Sector R&D </li></ul><ul><li>5.2 Private Sector R&D </li></ul><ul><li>5.3 Research in Optimizing the Use of Frequency Spectrum </li></ul><ul><li>6. Contents </li></ul><ul><li>6.1 Market Size of Mobile Internet Contents </li></ul><ul><li>6.2 Pricing of Mobile Internet </li></ul><ul><li>6.3 Popular Contents </li></ul><ul><li>7. Government </li></ul><ul><li>7.1 Role of Government </li></ul><ul><li>7.2 IT 839 </li></ul><ul><li>Terminal </li></ul><ul><li>8.1 Mobile Phone Platform </li></ul><ul><li>8.2 Technological Trend </li></ul><ul><li>8.3 Components </li></ul><ul><li>9. Foreseeable radical changes </li></ul><ul><li>10. Opportunities for Finnish Companies </li></ul><ul><li>11. Appendix : Abbreviations </li></ul>
    3. 3. 1. Introduction
    4. 4. <ul><li>Korea is the first country in the world that has successfully commercialized the CDMA technology. In the late 2002, Korea was already offering CDMA2000 EVDO service at the speed of 2.4Mbps downstream at the maximum. Satellite Digital Multimedia Service (DMB) that is currently offering mobile TV service was commercially launched in May this year. Terrestrial DMB is coming at the yearend. Wireless broadband internet service, Wibro, is slated for commercial service during Q2 in 2006. 3.5G mobile technology, HSDPA, is expected to be available next year as well. It is eye-popping to watch all these network technologies being deployed, handsets being developed and available, and services being used. It will be even more so when these various networks are integrated and converged, which is now underway in Korea. The keywords that are reflecting the mega trend in the Korean wireless industry - wireless broadband internet , multimedia , and convergence . </li></ul><ul><li>From operators’ point of view, mobile subscribers have reached saturation, revenue from pure voice calls has decreased, and competition among operators has never been more fierce. In order to sustain growth, it has been imperative for the operators to find new revenue sources, which are wireless broadband internet and wireless multimedia. To generate revenue from ‘anywhere, anytime, anyone’, these two services need to be seamlessly offered and easily available to customers on ‘any network’ That is why ‘Convergence Business’ or ‘U-Business’ has became the core of the new business developments at the communication service operators in Korea. </li></ul><ul><li>With the high usage fee of the mobile data services based on the current mobile communications system and small screen of handsets, there is a great deal of limitations in providing wireless broadband internet services. Existing WLAN service using the ISM bandwidth has difficulties in providing public services due to frequency interruption and low coverage. Therefore, there have been great demands for wireless broadband internet service that can offer a higher speed, lower fee, portability, and mobility. </li></ul>Introduction
    5. 5. Introduction <ul><li>Behind the success of the Korean communication industry stand the government, especially the Ministry of Information and Communication (MIC) and the customers who are willing to pay for new services and handsets. The government sets concrete targets and master plans to strengthen the national competitiveness, makes advanced investments, grants public funds to public and private R&D activities, stimulates private companies to make investment, and takes the role of a project manager. Koreans are hunting for free and lower prices. But at the same time, they don’t mind paying for faster and new services and goods. Value-added is appreciated and paid-off. </li></ul><ul><li>This report for TEKES highlights the wireless broadband technology and services on the horizon, future technologies that enable efficient frequency spectrum use and convergence, R&D activities, popular contents, terminal technologies and trend, government’s role, and foreseeable radical changes in Korea. From the benchmark study on the Korean experience and mega trend, a good insight about where a country in the forefront of the communication industry is moving toward and also its trials and errors can be earned. </li></ul><ul><li>Exchange rate is 1260 KRW for 1EUR </li></ul>
    6. 6. 2. Overview of the Market 2.1 Mobile Network Evolution 2.2 Mobile Subscribers 2.3 Performance of Mobile Operators 2.4 Mobile Internet 2.5 Mobile Phones
    7. 7. 2.1 Mobile Network Evolution
    8. 8. ICT Network Evolution in Korea Narrowband 1990 Broadband 2000 BcN 2010 2.4 – 9.6Kbps 1.5 – 2Mbps 50 -100 Mbps 2005 4-100 Mbps Convergence Services Fixed+Mobile TPS Wibro+ HSDPA+ WLAN+ DMB Home Networking IS95 A/B 64 Kbps IS95C 2000.10 144 kbps CDMA1-x EVDO 2002 Up:2.4 Mbps Down: 153kbps WCDMA/HSDPA CDMA1-x EVDV 2006 3/1.8Mbps for WCDMA 14 Mbps for HSDPA <ul><li>Voice and text communications </li></ul><ul><li>Low interoperability and synchronization among terminals </li></ul><ul><li>emphasis on electronic data processing </li></ul><ul><li>Narrowband technology </li></ul><ul><li>Broadband internet service </li></ul><ul><li>PC-based service </li></ul><ul><li>Web-based service </li></ul><ul><li>Networking among some IT products </li></ul><ul><li>Broadband technology </li></ul><ul><li>Various converged IT services </li></ul><ul><li>Universal IT integration & Universal networking </li></ul><ul><li>Broadband network technology : Digital convergence technology </li></ul><ul><li>Trial services in July ‘05 </li></ul>
    9. 9. CDMA2000 1X Network Configuration Internet BTS PDA IP Phone BSC BTS Notebook PDSN HA MSC/VLR RADIUS HLR IWF BSC BTS Gateway Router VMS SMSC SCP IP SCE/SMS Subscriber authentication occurs here Packet NW IP Phone PSTN IP Fax IP Fax
    10. 10. CDMA2000 EVDO Network Configuration BTS : Wireless link and wireless signal processing PCX/VLR : Subscriber Location Registration, Circuit Switch function IDR (Internet Detailed Record) : Managing data about internet usage for billing PGS (Gateway Switch) : Interconnection between different operators’ network BSC (APC) : Control of signals and resource management, Packet routing, trans-coding PDSN (Packet Data Serving Node) : Function of data routing protocol AAA (Authentication, Authorization, Accounting) : Subscriber authentication, data billing PAS (Personal Access System) : Function of Proxy between terminal and Web server WISE : KTF’s billing system Source : KTF Own Network Other’s Network
    11. 11. WCDMA Network Configuration Source: www.4g.co.kr Valued-added Service NW Internet Backbone NW No.7 Signal NW Core NW Wireless NW Internet NW BST RNC Mobile NW Other IMT NW 2G/3G Roaming NW ISDN PSDN
    12. 12. 2.2 Mobile Subscribers
    13. 13. Mobile Subscriber Penetration Source: SK Telecom and Gartner Dataquest (Unit: million subscriber )
    14. 14. Wireless Internet Subscriber Development <ul><li>As of May 2005, subscribers to wireless internet service reached 36 million (based on No. of handset sales) which is 96.5% of the total mobile phone users of 37,405,649. </li></ul>Source: MIC (Ministry of Information and Communication of Korea
    15. 15. Subscriber Development of CDMA 2000 1x and EV-DO Source: KISDI, October 2005 (Mobile Operators IR Reports) (Unit: thousand) CDMA 2000 1x EV-DO 11,769 6,430 760 - EV-DO 23,384 21,515 18,123 7,614 CDMA 2000 1x Aug. 05 1Q 04 1Q 03 1Q 02 Total No. of subscribers
    16. 16. Mobile Service Operators and Market Share (Year 2004) Source: SK Telecom Market Share by Operator <ul><li>SK Telecom has been enjoying the market leadership with the market share of over 50% although the company had to see more than 2.1 million subscribers churning to its rival operators, KTF and LG Telecom, since the introduction of Mobile Number Portability into the market in January 2005. </li></ul>Subscriber & Revenue Market Share by Operator
    17. 17. 2.3 Performance of Mobile Operators
    18. 18. Performance of SK Telecom & KTF(Q2 2005) SKT KTF 23.7% % Data to Total Revenue 196 minutes (+6%) (+1%) 17.5% (-0.6%) 442 bil KRW (+1%)(-23%) 10,419 KRW (+8%) (+39%) 44,105 KRW (+4%) (+3%) 597 bil KRW (+9%) (+43%) 467 bil KRW (+27%) (+56%) 713 bil KRW (+16%) (+54%) 2.5 tril KRW* (+5% to Q1) (+6% to Q4 ') 351 mil EUR 8.3 EUR 35 EUR 474 mil EUR 371 mil EUR 566 mil EUR 2.0 bil EUR Marketing expense to total Revenue MOU* Total ARPU Data Revenue Marketing expense Data ARPU Net income Operating income Total Revenue 18.7% (+0.4%) 232 bil KRW (+5.2%) 38,800 KRW (+3.5%) 25,107 KRW 5,154 KRW 148 bil KRW 15.2% (+2.3%) 222 bil KRW (+16.9%) 1.2 tril KRW(+3.1%) 184 mil EUR 117 mil EUR 176 mil EUR 952 mil EUR Marketing expense Marketing expense to total revenue Operating profit ratio Operating income Total ARPU Voice ARPU Data ARPU Data Revenue Total Revenue
    19. 19. 2.4 Mobile Internet
    20. 20. Mobile Internet Usage Source: Survey, National Internet Development Agency (NIDA), September 2005 Those who use mobile internet at least once during the last 6 months Frequency of Mobile Internet Use Source: Survey, National Internet Development Agency of Korea, September 2005
    21. 21. Mobile Service Revenue Outlook (Voice vs Data) (Unit: million EUR) (Source: Gartner Dataquest, June 2005) Mobile Internet Revenue as % of Non-voice Revenue (2Q05) 32% 30% 27% 25% 22% 19% 12% 8% 5% 3% % of data to total revenue 5,413 5,018 4,513 4,001 3,408 2,590 1,516 973 497 223 Data 11,640 11,915 12,117 12,105 11,837 11,342 10,707 10,585 10,173 8,100 Voice 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000
    22. 22. Trend in Mobile Internet Revenue by Operator <ul><li>SKT’s wireless internet revenue increased to 473.8 million EUR in 2Q 05 from 330.9 million EUR in 2Q 04 by expansion of wired and wireless integrated service, GPS, broadcasting service, and diversifying contents. </li></ul>(Unit: million EUR) Source: Electronic Times
    23. 23. Mobile Internet ARPU Trend by Operator SKT KTF LGT Source: Mobile Operators – SKT, KTF, LGT (Unit: EUR) SKT KTF LGT (Unit: EUR) SKT KTF LGT (Unit: EUR) SKT KTF LGT (Unit: EUR)
    24. 24. Mobile Phone Usage Patterns <ul><li>Mobile phone users over 12 years old use the voice call 70.9 times (4.1 hours per week) and SMS 61.8 times a week. The voice call use ratio of the mobile phone use is 71.9 % followed by 24.3 % for SMS and 3.8% for mobile internet. </li></ul><ul><li>Mobile phone owners have used their current phones for 15.6 months on average. Those aged 12-19 change their phones as often as 10.5 months while 22.4 months for those over 50 years old. </li></ul><ul><li>People consider ‘digital camera(70.9%)’ function most important when purchasing mobile phones. Wireless internet(56.8%), moving image recording(47%), MP3 player(29.4%) functions are also considered important. </li></ul>Source: Survey, National Internet Development Agency of Korea, September 2004 (Unit: times) Frequency of SMS Message Use 15.8 up Mobile Phone Usage Patterns 4.3 up (Unit: times) Frequency of SMS Message Use 15.8 up
    25. 25. 2.5 Mobile Phone
    26. 26. Market Size of Domestic Mobile Phone (unit: million units) Shipment = Domestic sales + Export Source: National Statistics Office / R&D Biz Mobile Phone Production in Korea (# of phones) Unit: 10,000 units Domestic Camera Phone Sales Source: MIC, 2004 Source: MIC 2005 14.2 2000 13.7 2001 2005(E) 2004 2003 13~16 15.9 14.9 Market Size 34.4% 3.2% 28.7% 28.8% CAGR (%) 164,592,158 18,411,587 183,003,745 184,148,569 2004 118,050,521 17,868,087 135,918,608 133,907,276 2003 92,517,604 17,430,986 109,948,590 107,031,100 2002 76,375,188 15,349,835 91,725,023 89,982,724 2001 50,463,036 16,222,713 66,685,767 66,910,145 2000 Export Domestic Sales Shipment Production - 99% 81% 51% 8% Camera phone ratio 108.3% 1,500 1,300 710 130 Sales volume CAGR(%) 2005(E) 2004(E) 2003 2002
    27. 27. Mobile Handset Production Value Source: Korea Customs Service (Unit: 1,000 USD)
    28. 28. Handset Market Share by Manufacturers (2004) Source: Pantech & Curitel 2,585,000 Others Shipment (units) Manufacturer 16,742,000 904,000 2,418,000 3,645,000 7,190,000 Total Motorola Pantech LG Samsung
    29. 29. Domestic Handset Market by Type (2004) <ul><li>Handset production value in 2004 reached 25.5 billion EUR, an increase of 24.6% from the previous year. CDMA, GSM, and TDMA handsets accounted for 42.7% (10,931 m EUR), 56.7% (14,507 m EUR), and 0.5% (132.7 m EUR) respectively. </li></ul>
    30. 30. Mobile Handset Export (2004) <ul><li>Mobile handset export in 2004 marked 17,678,7900,000 USD, 42.1% up from a year ago. USA was the biggest overseas market for Korean handset manufacturers with a sales value of 6,750,790,000 USD (38.3%) followed by UK with 1,040,680,000 USD (5.9%). </li></ul>(Unit: 1,000 UDS)
    31. 31. 3 . Technology 3.1 CDMA2000 EVDO 3.2 Wibro 3.3 DMB: Satellite & Terrestrial 3.4 3G : WCDMA, HSDPA, CDMA EVDV 3.5 WLAN
    32. 32. 3.1 CDMA2000 EVDO
    33. 33. <ul><li>Theoretical maximum speed of EVDO is 2.4Mbps (downstream) on 1.25MHz channel, but practical speed is about 620Kbps, which is already much better than WCDMA. </li></ul><ul><li>ITU approved EVDO as one of 3G technologies. </li></ul><ul><li>Services on EVDO are rich multimedia contents. </li></ul><ul><li>Current EVDO services of SKT and KTF use CDMA20001x network for voice calls and EVDO network for high-speed data service. </li></ul>Comparison between EVDO and other wireless broadband Services Flat Pay as used Pricing 84 cities Nationwide Coverage High speed data Low-medium speed data Service type Service aspects 60Km/h 300Km/h Mobility Partially guaranteed guaranteed guaranteed Not guaranteed QoS 4.9Mbps 2Mbps 2Mbps 153.6Kbps Maximum upstream 18.4Mbps 10Mbps 2Mbps 2.4Mbps Maximum downstream Data only Voice+Data Voice+Data Data only Offered Service 10MHz 5MHz x2 5MHz x2 1.25MHz x2 Bandwidth/FA Technical aspects Wibro HSDPA WCDMA R4 EVDO
    34. 34. CDMA2000-1x and CDVMA2000-EVDO <ul><li>Launched in Oct.2000 </li></ul><ul><li>Voice-oriented protocol + low-speed packet data service </li></ul><ul><li>Launched in Nov.2002 </li></ul><ul><li>Data-only network </li></ul><ul><li>High-speed multimedia data service </li></ul><ul><li>Qualcomm MSM Dual-Mode chip </li></ul><ul><li>QoS per media is unavailable </li></ul>BTS BSC MSC HLR Data NW PDSN HA Voice NW CDMA2000-1x CDMA2000-EVDO Data only NW DRL ANTS ANC AN AAA CDMA2000-1x CDMA2000-EVDO PSTN internet
    35. 35. 3.2 Wibro
    36. 36. What is Wibro? <ul><li>Wibro = Wireless Broadband Internet Service </li></ul>Internet Access Fixed Broadband Mobile Internet WLAN Non-mobile Low speed High tariff Small screen Low coverage Wibro Low fee : 25-30 EUR/month High speed : 3 Mbps Mobile : 60km/h Higher coverage Source: ETRI
    37. 37. Why Wibro? - - Need another success story after CDMA - Create new jobs - Create exports - Create IPRs & lead international standardization: (lesson from CDMA : 1B Euro import of core chips & annual 400M royalty to Qualcomm ) - New demands are coming from data services - Must create new services to cope with saturation - No churn-out to competitor’s new service & churn-in thru new service - Wants faster, reasonably priced, personalized, seamless, easy-to-use MM services MIC’s perspective User’s perspective Operator’s perspective KISDI outlook, 2004 Wibro Market Outlook, ETRI, Oct., 2003 6.3TKRW Generated exports 4.6TKRW Generated imports 7.4TKRW Created value-adds 18TKRW Generated production 20% 4.8% CAGR 6.4T 11.6T 8.1T 6.3T ’ 08 3.1T 13T 6.7T 6.5T ’ 04 Data Voice Data Voice Wireless Wired
    38. 38. Market Outlook Total accumulated turnover : 17.4 tril KRW (14 bil EUR) - Operators’ turnover : 10.5 tril KRW (83 bil EUR) based on 30000KRW ARPU - Total equipment turnover : 4.3 tril KRW (3.4 bil EUR) Terminal: 1.8 tril KRW (1.4 bil EUR) based on module only System : 2.5 tril KRW (1.9 bil EUR) - Contents : 2.6 tril KRW (2.0 bil EUR) <ul><li>- Total subscriber : 9.6M </li></ul><ul><li>- KT’s Subscriber : 3.1M </li></ul><ul><li>- ARPU : 33,000KRW(30EUR) </li></ul><ul><li>Turnover: 1.2 tril KRW (1 bil Euro) in 2010 for KT itself </li></ul><ul><li>Accumulated investment : 1.2 tril KRW (1 bil EUR) </li></ul>KT’s Projection by 2010 ETRI’s Projection (2006-2011) Wibro Subscriber Outlook (unit: million people) Source: ETRI 9.02 8.6 7.5 5.72 3.48 1.41 0.266 Accumulated increase 0.455 1.06 1.78 2.24 2.07 1.14 0.266 Net increase T+6 T+5 T+4 T+3 T+2 T+1 Trial
    39. 39. Services / Contents / Price <ul><li>Service launch : by June 2006 at the latest </li></ul><ul><li>Preferred services :MMS, file transactions, email = add mobility to fixed broadband internet </li></ul><ul><li>Preferred tariffs : monthly flat at around 30,000KRW (25 Euro) </li></ul><ul><li>Popular contents : </li></ul>Info search E-mails Games Chatting, Messenger Shopping Stocks Ringtone/coloring Screen background Game Animated image Games Email Search Messenger MMS Fixed Broadband Mobile internet Wibro Business Model Mobile WLAN Broadband Internet Access Wibro e-Mail MMS, LBS Messenger Game M-Commerce MVoIP ASP Value- Added Service
    40. 40. Wibro Operator : KT (1) <ul><li>Wibro as a core to expand its broadband internet business into wireless broadband and to strengthen its position in convergence business.* </li></ul><ul><li>Wants to make Wibro compete against SKT’s HSDPA. While SKT does not invest in Wibro, KT budgeted 39 bil KRW (31 mil EUR) for its trial service in Busan during APEC in November 2005. </li></ul><ul><li>Within KT Group, KT views Wibro as a competing supplementary to HSDPA of KTF. </li></ul>Price Competitiveness Accessibility /Mobility Portability Speed Voice oriented Data dedicated Wibro HSDPA Source: “Easy Wibro”, ETRI, 2005 Lap-top, PDA Metropolitan Mobile phone Smaller cities
    41. 41. Wibro Operator : KT (2) <ul><li>Plans to launch Wibro over IPv6 trial service during 2H of 2005. </li></ul><ul><li>Will install 300-400 IPv6-based AP in campuses during 2H 2005. </li></ul><ul><li>For this, KT will offer IPv6-based ‘ Paran ’ Wibro portal </li></ul>Wibro over IPv6 Price <ul><li>Plans to adopt partial flat rate with various discount policies. </li></ul><ul><li>3 types of pricing ; Mania, Saver & Standard, Premium. </li></ul><ul><li>Initial price for Wibro is estimated to be 15000 – 25000 KRW. </li></ul>Killer Contents MMS, LBS, Games, IP broadcasting (iCOD) are targeted killer apps NW Building <ul><li>July 2005 ; Procurement contract for core equip’t </li></ul><ul><li>August 2005 : Procurement contract for repeaters </li></ul><ul><li>September – October 2005 : NW building for trial service at APEC </li></ul><ul><li>November 2005 : Delivery and installation/optimization of core </li></ul><ul><li>equipment and repeaters until Feb.2006 </li></ul><ul><li>January 2006 : Partnership for distribution NW </li></ul><ul><li>Feb, 2006 : Trial service launch </li></ul><ul><li>April 2006 : Commercial service launch in Seoul and Busan </li></ul><ul><li>Plans to invest 200 billion KRW in Wibro during 2H 2005 </li></ul>
    42. 42. Wibro Operator : SK Telecom (1) <ul><li>SKT was selected as a Wibro operator in Feb.2005 </li></ul><ul><li>HSDPA first, and then Wibro comes later as a supplement to HSDPA. </li></ul><ul><li>Expected investment for Wibro is about 800 bil KRW (64 mil EUR), but no investment plan for 2005. Investment in 2005 goes to WCDMA/HSDPA. </li></ul><ul><li>Plans for trial service in June 2006 </li></ul><ul><li>Issued RFP to 7 system vendors including Samsung and LG in June 2005. BMT will be in August 2005. CDR (detailed design review) will be done by yearend. </li></ul>Wibro in Metropolitan Mobile NW & WLAN Q4, ’05 Complete development of Wibro system and terminal Q1, ’06 Production of system, install, optimization Apr, ’06 Trial service Jun, ’06 Commercial service in Seoul. Gradually expand coverage to 84 cities NW building Plan on Wibro
    43. 43. <ul><li>SKT’s Survey & Outlook on Wibro: After Y+5 </li></ul>Total subscriber 9.3 M (market total) Willingness to use 49% is willing to subscribe, but not replacing existing service. Terminal 79% preferred mobile handset type. Location of usage Both outdoor on the move and indoor. Preferred contents Search (74%), email (39%), game (31%) Other entertainment (20%), large size messenger (15%) Killer Contents MMS* SK Telecom focusing on HSDPA Speed WCDMA (R4) with 384(up)-2Mbps(down) speed doesn’t offer service difference from CDMA EVDO. HSDPA can offer 14Mbps at the maximum. Terminal - Mobile phone type handset is preferred by users, giving HSDPA more advantage.* - Manufacturers are more active on HSDPA phone and likely to release 1.8Mbps capable commercial phone by early 2006. Costs HSDPA is mostly a S/W upgrade, with less costs. Mobile TPS HSDPA is easier to realize mobile TPS than DMB or Wibro.
    44. 44. SK Telecom’s Business Overlap SK Networks SK Communications Widerthan.Com TU Media Wibro HSDPA DMB june/NATE (CDMA) Mobile TV W-internet MMS
    45. 45. Wibro Vs. Other Technology Wibro vs. DMB Wibro vs. Fixed broadband Wibro vs. WLAN Changeable (depending on user number and NW condition Quality 300Km/h 60Km/h Mobility Leisure Every day life style Usage Nationwide Metropolitan Coverage Downstream real time broadcasting service (23 video Ch, 25 audio Ch) IP-based interactive service (NW game, search, animated pictures etc.) Service DMB Wibro Household Individual Subscriber 50-100Mbps/sub on BcN 1Mbps/subscriber Service Fixed broadband Wibro 100m 1Km Cell radius Walking Over 60km/h Mobility Over 1Mbps Over 1Mbps Transmission speed/user Lap-top, HPC Handset, PDA, HPC, lap-top Terminal Hot spots metropolitan Coverage WLAN Wibro
    46. 46. Wibro vs. HSDPA (Technical Aspects) Source: “Easy Wibro”, ETRI, 2005 Data+Voice Data only Offered Service 2Mbps 4.9Mbps Maximum upstream PDA, smart phone Laptop, PDA, HPC, smart phone Terminal 200MKRW/unit 100MKRW/unit Cost for BST National (voice) + 84 cities (data) 84 cities Serviced area Less than 250km/h Less than60km/h Mobility ~4km ~1km Coverage 10.5Mbps 18.4Mbps Average transferable file size/FA Wireless internet connection Wireless broadband internet connection Service Concept HSDPA Wibro
    47. 47. Wibro vs. HSDPA (Service Aspects) Source: “Easy Wibro”, ETRI, 2005 W: fixed internet contents, large size MM files H: voice, small size MM files Internet connection and MMS Contents W: HPC, lap-top H: mobile phone Smart phone, PDA Terminal W: ’20-’30s workers and students H: ’10-’20s students ’ 20-’30s using smart phone type handsets Main customers W: mobility to fixed broadband and larger coverage H: faster data service Internet connection and MMS on the move Customer needs Speed, mobility, coverage Suitable for internet, data services Technical W: based on IP NW H: mobile NW Wireless broadband connection with MMS Service Differences Similarities
    48. 48. Wibro System Concept (source: High-Speed Portable Internet Technology, ETRI, Electronics and Communication Trend, No.18, Vo.6, Dec., 2003 -Narrow guard band & minimize other cell interference -support multiple cell planning -Optimize cell coverage Effective freq. reuse mobility (60km/hour) Handover Full coverage & easy cell planning <ul><li>Maximize spectrum efficiency (bit/Hz/sector) </li></ul><ul><li>-maximize average cell & user throughput </li></ul><ul><li>-minimize # of effective active users per sector </li></ul><ul><li>-Minimize peak to average power ratio </li></ul><ul><li>-Optimize power amp.output power </li></ul>Lower than 1/10 cost per cellular Low cost -support AMC, H-ARQ -support MIMO (2 stage) -minimize latency 20-50Mbps/10MHz High speed data Supporting technology Goal
    49. 49. Wibro System Structure Access Terminal Access Point Access Point Access Point Packet Access Router Packet Access Router <ul><li>Functions of AT : </li></ul><ul><li>Low power consumption RFIF module and controller </li></ul><ul><li>- MAC frame control according to frequency environment & service specifications </li></ul><ul><li>- Handover </li></ul><ul><li>Authentication and encryption </li></ul><ul><li>measurement and filtering control </li></ul><ul><li>Functions of AP: </li></ul><ul><li>Low power RF/IF module and controller </li></ul><ul><li>OFDMA/TDD packet scheduling and channel multiplexing </li></ul><ul><li>MAC frame control according to frequency environment & service specifications </li></ul><ul><li>Real time control of 50Mbps-level high traffic </li></ul><ul><li>Handover </li></ul><ul><li>Functions of PAR : </li></ul><ul><li>Handover control among Access Points </li></ul><ul><li>Handover control among Packet Access Routers </li></ul><ul><li>Authentication </li></ul><ul><li>Packet Routing </li></ul><ul><li>Internet Access </li></ul>Functions of AT and AP : -Alteration of 50Mbps packet transfer -Coding of high speed packet channel -Real time modem control
    50. 50. 3.3 DMB
    51. 51. What is DMB? <ul><li>DMB = Digital Multimedia Broadcasting </li></ul><ul><ul><li>CD quality audio and multimedia broadcasting and communications services on the mobile through mobile phone, PDA, and other portable terminals </li></ul></ul><ul><li>Two technologies : Satellite and Terrestrial </li></ul>Satellite Terrestrial 1 Operator 6 Operators Free of charge Monthly fixed fee Subscription fee Advertising Nationwide Seoul and its neighbor cities 2630 – 2655 MHz (UHF) 25MHz VHF Band III : Ch 12 (204~210MHz) Ch 8 (180~186MHz) 12MHz Operators Service Fee Profit Model Initial NW Coverage Bandwidth System E (based on CDM) System A (Eureka 147) Technical Standard Video Compression MPEG4 Advanced Video Coding MPEG4 AVC (H.264) Audio Compression MPGE2 AAC+ MPEG4 BSAC Transmission Capacity 7.68Mbps 6.912Mbps
    52. 52. History of DMB in Korea <ul><li>1997 MIC (Ministry of Information and Communication) formed a ‘Group for Terrestrial Digital Broadcasting’ to start discussing introduction of DMB </li></ul><ul><li>1999 MIC formed a ‘Development Group for Introduction of DAB’ </li></ul><ul><li>2000 MIC formed a ‘Task Force for Terrestrial Digital Radio Broadcasting’ </li></ul><ul><li>2001 MIC’s Council for Terrestrial Digital Radio Broadcasting adopted ‘Eureka 147’ as a preliminary national standard </li></ul><ul><li>12.2002 MIC confirmed ‘Eureka 147’ as the national Terrestrial DMB standard </li></ul><ul><li>09.2001 MIC applied for international registration for satellite network with ITU after SK Telecom’s application </li></ul><ul><li>11.2001 MIC granted SK Telecom a license for satellite DMB test for 1 year </li></ul><ul><li>04.2002 MIC applied for international registration for satellite network with ITU after KT’s application </li></ul><ul><li>04.2002 MIC formed a ‘Council for Satellite DAB Standardization’ </li></ul><ul><li>07.2002 MIC formed a ‘Group for Satellite DAB Policy’ </li></ul><ul><li>04.2003 MIC adopted ‘System E’ requested by SK Telecom as the national satellite DMB technical standard </li></ul><ul><li>03.2004 Satellite ‘Han Byol’ was blast-off. </li></ul>Terrestrial DMB Satellite DMB
    53. 53. DMB Market Outlook <ul><li>Keys to Success of DMB Service </li></ul><ul><ul><li>Induce customers to buy DMB terminals </li></ul></ul><ul><ul><li>Offer killer applications to create revenue </li></ul></ul><ul><ul><li>Cooperate among DMB operators, terminal manufacturers, and mobile service operators in order to minimize costs </li></ul></ul><ul><li>Economic Effect of DMB Service (Unit: billion KRW, 1000 people) </li></ul>Source: Korea Mobile White Paper 2005, NIDA Domestic DMB Terminal Market Outlook (unit: billion KRW) Source: Korea Mobile White Paper 2005, NIDA 48 40.9 31.1 23.1 13.7 6.8 Employment Generated 4,366 (3.5 b EUR) 3,691.7 (2.9 b EUR) 2,788.6 (2.2 b EUR) 2,049.6 (1.6 b EUR) 1,199.5 (952 m EUR) 529.4 (420 m EUR) Production Generated 2010 2009 2008 2007 2006 2005 1,320 (1.05 b EUR) 1,253.3 (995 m EUR) 1,069.2 (849 m EUR) 895.1 (710 m EUR) 539.3 (428 m EUR) 266.7 (212 m EUR) Turnover 2010 2009 2008 2007 2006 2005
    54. 54. DMB Subscribers Outlook (Unit: million people) Source: SK Telecom and Korea Mobile White Paper 2005
    55. 55. 3.3 DMB : Satellite DMB
    56. 56. <ul><li>Introduction </li></ul><ul><li>08.2001. SK Telecom signed MoU with Japan’s MBCo. SK Telecom invested 1.2 billion Yen in MBCo acquiring 5.9% of the total shares. With additional investment, SK Telecom’s total investment in MBCo reached 2.7 billion Yen. </li></ul><ul><li>Trial service </li></ul><ul><li>January 2005 with 3 video and 6 audio channels. </li></ul><ul><li>Commercial service </li></ul><ul><li>May 2005 </li></ul><ul><li>Number of channels </li></ul><ul><li>41 channels as of October 2005 (10 video and 30 audio channels) </li></ul><ul><li>Mobile service </li></ul><ul><li>TU Media has service agreement with all 3 mobile operators. </li></ul><ul><li>Subscribers </li></ul><ul><ul><li>100,000 as of end of July, 2005 (93,400 for mobile phone and 6,600 for car terminal) </li></ul></ul><ul><ul><li>230,000 as of October 2005 </li></ul></ul><ul><li>Shareholders of TU </li></ul><ul><li>SKT 28.5% </li></ul><ul><li>MBCo 9.5% </li></ul><ul><li>Partners 44% </li></ul><ul><li>Financial Institutions 11.3% </li></ul>
    57. 57. <ul><li>Why Satellite DMB? </li></ul><ul><li>Average monthly voice calls per user : 180 – 190 minutes </li></ul><ul><li>Average monthly revenue per user : 40,000 KRW (32 EUR) </li></ul><ul><li>Saturation of mobile voice and ARPU => Nee new revenue source was needed. </li></ul><ul><li>Business Model </li></ul><ul><li>Monthly flat fee : 13000KRW (10 EUR) </li></ul><ul><li>Sales is done by mobile phone/service distributors </li></ul><ul><li>Bill is integrated with mobile phone bill </li></ul><ul><li>Market Outlook </li></ul><ul><li>Mobile phone type DMB terminal is expected to reach 610 billion KRW (484 mil EUR) by 2010, taking 64% of the total domestic DMB terminal market. </li></ul><ul><li>Vehicle DMB terminal is expected to reach 3.9 million units worth of 580 billion KRW (460 million EUR) by 2010, taking 15% of the total domestic DMB terminal market. </li></ul>
    58. 58. Investment by TU Media <ul><li>Investment by SK Telecom and TU Media between 2001 and 2004 </li></ul><ul><li>4,800 units of Gap Filler were installed as of May 2005. Another 120 billion KRW (95 Mil EUR) was budgeted during 2005 for additional Gap Filler. </li></ul><ul><li>TU Media’s further investment plan for the next 5 years </li></ul><ul><li>Contents development 256 bil KRW (203 Mil EUR) </li></ul><ul><li>Support for broadcasting business 7 bil KRW (5 Mil EUR) </li></ul><ul><li>Commission to Program Providers 442 bil KRW (351 Mil EUR) </li></ul><ul><li>Paid-in-capital of TU Media as of May 2005 : 137 billion KRW (109 Mil EUR) </li></ul><ul><li>Projected break-even point : 2009 </li></ul><ul><li>TU Media estimates that 2.5 million subscribers is the turning point to make a profit and 5.5 million to break-even. </li></ul>46 (37 Mil EUR) 124 (98 Mil EUR) 46 (37 Mil EUR) 100.8 (80 Mil EUR) 357 (283 Mil EUR) IT System Gap Filler Broadcasting Center Satellite Total (Bil KRW)
    59. 59. Satellite DMB System Structure Satellite Broadcasting Center Ku Band(13.824~13.883GHz) Send programs Terminal S Band (2.630~2.655GHz) Gap Filler Ku Band (12.21~12.23GHz) S band (25MHz on 2.630~2.655MHz)
    60. 60. Satellite DMB Terminals <ul><li>Success of DMB service leis in releasing popular handsets that will attract mobile subscribers. As customers are not likely to have two mobile handsets, DMB phone must have features that attract mobile phone users. According to SK Telecom’s survey, 56.4% preferred mobile phone type terminal while 24.7% chose PC type terminal, and 12.1% selected vehicle terminals for the DMB terminal. </li></ul><ul><li>Samsung released the 1 st DMB mobile phone, SCH-B100. The success of commercial DMB service in time was possible because handset manufacturers were willing to take the risk in the early stage. </li></ul><ul><li>DMB baseband chip for satellite DMB terminal is supplied by Toshiba, LG Electronics, and TelAce (a Korean venture start-up). </li></ul>SPH-B2000 SCH-B200 SCH-B250 SCH-B130 Satellite DMB Phones by Samsung Electronics
    61. 61. Satellite DMB Terminals LG-SB120 IMB 1000 PT-S130 POZ-B300 Satellite DMB Phones by other manufacturers IDC 2100 HDMB 1000 IDC1000 HN3000 SD10 28A Satellite DMB Vehicle Terminals Satellite DMB Portable Terminal
    62. 62. Challenges of Satellite DMB <ul><li>TU does not offer real-time relay of terrestrial broadcasting service at the moment. Korean TV contents are dominate by 3 terrestrial broadcasting companies – KBS, SBS, and MBC. 70% of Cable TV programs (based on view percentage) are relay of terrestrial broadcasting companies’ programs. Therefore, it is a challenge for TU Media to attract them in the service agreement in order to grab more subscribers. </li></ul><ul><li>Developing mobile phone battery that will last longer to view DMB service longer. Currently it only lasts about 2 & half hours when using DMB service consecutively. </li></ul><ul><li>Finding business model for data service through DMB. When developing data service through DMB, it is essential to have middleware to integrate with mobile internet and mobile voice service on the mobile phone. </li></ul>
    63. 63. 3.3 DMB : Terrestrial DMB
    64. 64. <ul><li>Operators </li></ul><ul><li>6 Operators : 3 Existing Terrestrial Broadcasters - KBS, MBC, SBS </li></ul><ul><li>3 Non-Terrestrial Broadcasters - TYN DMB, Korea DMB, KMMB </li></ul><ul><li>Initial Service Deployment </li></ul><ul><li>Seoul and its neighbor cities were selected in March 2005 </li></ul><ul><li>Frequency band </li></ul><ul><li>1.536MHz of frequency band is given to each operator. </li></ul><ul><li>Commercial service </li></ul><ul><li>December 2005. </li></ul><ul><li>Hurdles to terrestrial DMB </li></ul><ul><li>- too many operators (6) to compete in the small market </li></ul><ul><li>- huge costs to build Gap Fillers in the shadow areas </li></ul><ul><li>- lack of terminal distribution channel. </li></ul><ul><li>- lack of cooperation model with mobile operators </li></ul>Source: Korea Mobile White Paper 2005, NIDA Terrestrial DMB Market Outlook 105.6 (560) 91.6 (72.7) 54.6 (43.3) 37.2 (29.5) 15.4 (12.2) 9.1 (7.2) Turnover (bil KRW, mil EUR) 2010 2009 2008 2007 2006 2005
    65. 65. Service Structure of Terrestrial DMB T-DMB DAB (Eureka 147) FIC MSC MCI & SI FIDC Audio Service Data Service Video Service TDC EWS Audio PAD NPAD Block Code MPEG4 LIVE TV 2CH Multi CH DLS TDC MOT IP Tunneling TDC MPEG4 A/V MPEG4 Data Broadcast Web Site Interactive Service JPEG Slide Show Source: Easy DMB, ETRI, 2005 FIC: Fast Information Channel MSC : Main Service Channel SI : Service Information FIDC: Fast Information Data Channel MCI: Multiplex Configuration Information TDC : Traffic Message Channel EWS : Emergency Warning System PAD: Program Associated Data NPAD: Non-PAD DLS : Dynamic Label Segment
    66. 66. Data Service over Terrestrial DMB <ul><li>PAD (Program Associated Data) </li></ul><ul><li>Deliver data in text, picture, or graphics along with Terrestrial DMB’s audio service. Information on song title, singer, song writers, musicians, lyrics, concert schedules, etc. can be seen in text form on the end-users’ terminal. </li></ul><ul><li>NPAD </li></ul><ul><li>Data service is done through a separate channel from the video or audio program. </li></ul><ul><li>BWS (Broadcast Web Site) </li></ul><ul><li>Transfer the whole of a website using DMB channel, to make it as if surfing a website. </li></ul><ul><li>EPG (Electronic Program Guide) </li></ul><ul><li>Transfer program information like the program guide on the newspaper. </li></ul><ul><li>MOT (Multimedia Object Transfer) </li></ul><ul><li>Transfer a multimedia object using DMB data channel. </li></ul><ul><li>Slide Show </li></ul><ul><li>Show pictures or cartoons is a Slide Show form. </li></ul><ul><li>DLS (Dynamic Label Segment) </li></ul><ul><li>Send text information about news, singers, lyrics, emergency, a prompt report, etc. </li></ul><ul><li>IP Datagram Tunneling </li></ul><ul><li>Encapsulate a bucket of data in a packet format and transfer it over IP. </li></ul><ul><li>Paging </li></ul><ul><li>Using IP Datagram Tunneling, page a certain group of subscribers having addresses through a Web server. </li></ul><ul><li>TMC (Traffic Message Channel) </li></ul><ul><li>Transfer traffic information in text while delivering traffic situation in video. </li></ul><ul><li>EWS (Emergency Warning System) </li></ul><ul><li>Automatically change channels when national emergency situations happen. </li></ul><ul><li>TTI (Traffic and Travel Information ) </li></ul><ul><li>Send traffic information about route and situation in voice, text, and graphics. A driver can send traffic information to a broadcaster’s database server using a return channel, i.e. Wibro. Information about hotel, parking space, etc., can b e sent. </li></ul><ul><li>DPGS (Differential Global Positioning System) </li></ul><ul><li>Integrate traffic info and electronic map with location-based information using GPS and send it to car navigation system. </li></ul>
    67. 67. 3.4 3G
    68. 68. 3G Service in Korea <ul><li>2 Technical Standards </li></ul><ul><ul><li>2 WCDMA operators (SK Telecom and KTF) and 1 CDMA 2000 EVDV operator (LG Telecom) </li></ul></ul><ul><li>WCDMA </li></ul><ul><ul><li>Commercial WCDMA service was launched in December 2003 in Seoul and 7 other metropolitans, according to the obligation of the 3G license. </li></ul></ul><ul><ul><li>As CDMA 2000 EVDO launched in 2002 has the equal or better performance than WCDMA, WCDMA operators (SK Telecom and KTF) have not been active in network deployment and service marketing. </li></ul></ul><ul><ul><li>WCDMA R4 subscribers : SKT 4,100 + KTF 300 = 4,400 (as of 09.2005) </li></ul></ul><ul><li>CDMA2000 EVDV </li></ul><ul><ul><li>As Qualcomm excluded EVDV chip from its roadmap, LG Telecom is unsure about its CDMA2000 EVDV service schedule. However, recently, LGT announced its investment in EVDO rA for next year. </li></ul></ul><ul><li>HSDPA </li></ul><ul><ul><li>WCDMA R5 version is called HSDPA. MIC and WCDMA operators agreed to migrate directly to HSDPA. </li></ul></ul>
    69. 69. 3.4 3G : WCDMA
    70. 70. Source: Easy DMB, ETRI, 2005 <ul><ul><li>Operators do not see service differentiation of WCDMA from EVDO. </li></ul></ul><ul><ul><li>Due to lack of enthusiasm of the operators, handset manufacturers also do not see the market to develop attractive WCDMA phones. </li></ul></ul><ul><ul><li>Delay in dual-mode-dual-bandwidth handset : only 3 DBDM handset models were released during 1H 2005 </li></ul></ul><ul><ul><li>Limitation of Handover between CDMA and WCDMA </li></ul></ul><ul><ul><li>Limitation of handset battery </li></ul></ul><ul><ul><li>Expensive handset price </li></ul></ul>Delayed WCDMA Service 2008 1~2Mbps 70Mbps MobileFi (802.20) 2007 1~2Mbps 70Mbps WiMax (802.16e) 2005 300~500Kbps 2~3Mbps OFDM 2006 300~500Kbps 1.3Mbps TD-SCDMA 2005/2006 600~700Kbps 2.4Mbps TD-CDMA 2006 900Kbps 14Mbps HSDPA 2004 300~500Kbps 2Mbps WCDMA 2002/2003 300~500Kbps 2.4Mbps CDMA EVDO Commercialization Practical throughput per subscriber Maximum Technology
    71. 71. WCDMA Service in Korea <ul><li>SKT completed development of WCDMA R4 system at the end of 2003 and started a commercial service in Seoul. It released a commercial WCDMA-CDMA handover handset in the beginning of 2005. </li></ul><ul><li>In order to boost WCDMA service, SKT introduced a ‘Data Free’ monthly flat fee pricing program at the price of 16,000 KRW (12.7 EUR) which is about 30% lower than its CDMA service price. </li></ul><ul><li>Available Services: </li></ul><ul><ul><li>Communications : high quality voice (12.2 kbps), interactive video telephony, prepaid intelligent service </li></ul></ul><ul><ul><li>Messaging : Various MMS, large-sized SMS, Video mailbox </li></ul></ul><ul><ul><li>Contents : Mobile TV, movie/music download, streaming VOD, phone decoration such as multimedia background picture, ring tone, and avatar, Network game </li></ul></ul><ul><ul><li>Commerce : Mobile payment (USIM-based credit card /transportation card), m-commerce (stock/banking), lottery, shopping, reservation, etc </li></ul></ul><ul><ul><li>LBS : real time traffic information </li></ul></ul><ul><ul><li>Automatic voice and video roaming </li></ul></ul>Investment in WCDMA and HSDPA Source: Operators 410 bil KRW (325) 250 bil KRW (198) 160 bil KRW (127) 2H 2005 300 bil KRW (238) 50 bil KRW (40) KTF 1 tril KRW (794) 600 bil KRW (476) Total 590 bil KRW (468) 540 bil KRW (429) 1H 2005 Total SKT (million EUR)
    72. 72. 3.4 3G : HSDPA
    73. 73. <ul><li>Commercial service launch </li></ul><ul><li>March 2006 </li></ul><ul><li>SKT’s Plan </li></ul><ul><ul><li>Build HSDPA NW by end of 2005 </li></ul></ul><ul><ul><li>Interoperability test between terminal and NW in Jan.2006 </li></ul></ul><ul><ul><li>Launch commercial service in March 2006. </li></ul></ul><ul><ul><li>Provided that Qualcomm’s HSDPA chipset MSM6280 that supports 7.2Mbps is released by Nov.2005. </li></ul></ul><ul><ul><li>Develop DBDM (dual-band-dual-mode) HSDPA handset with Samsung, LG, and Pantech next year. </li></ul></ul><ul><ul><li>Likely to adopt a monthly flat rate (similar to or lower than EVDO) in the beginning to activate the market </li></ul></ul><ul><ul><li>Attract between 200,000 - 500,000 HSDPA subscribers by the end of 2006. </li></ul></ul><ul><li>KTF’s Plan </li></ul><ul><ul><li>Plans to sell HSDPA phones during 2H of 2006 and attract 200,000 minimum and 500,000 maximum HSDPA subscriber. </li></ul></ul><ul><li>HSDPA R&D </li></ul><ul><ul><li>Samsung and LG are developing HSDPA chip and system. LGE has developed Base Station modem ASIC that supports 14Mbps. </li></ul></ul><ul><ul><li>Agilent and Anritsu are developing measurement equipment for HSDPA R&D </li></ul></ul>HSDPA LG’s HSDPA Base Station modem
    74. 74. 3.4 3G : CDMA2000 EVDV
    75. 75. CDMA2000 EVDV EVDO rA <ul><li>EVDV Operator : LG Telecom </li></ul><ul><li>Now that Qualcomm and other chip-makers excluded EVDV chipset from its development roadmap, LG Telecom announced that it would replace EVDV with EVDO rA. </li></ul><ul><li>LGT plans to build EVDO-rA system from the end of 2005. </li></ul><ul><li>Service Launch : 2H 20006 </li></ul><ul><li>EVDO-rA is a upgraded system of EVDO-r0 SKT and KTF offer currently. Using 1.25Mbps channel (FA), EVDO-rA can realize 3.1Mbps (downstream is 1.8Mbps) of transmission speed. Downstream of rA is 10 times faster then r0. </li></ul><ul><li>  </li></ul>
    76. 76. 3.5 WLAN
    77. 77. Wireless LAN Source: MIC <ul><li>Operators : KT, Hanaro </li></ul><ul><li>Technical standard : IEEE 802.11b </li></ul><ul><li>Bandwidth : 2.4GHz </li></ul><ul><li>Wi-Fi certified WLAN Card and MAC-based authentication </li></ul><ul><li>Data transmission speed : maximum 11Mbps, average 3~5Mbps within 100M from an AP </li></ul><ul><li>Major WLAN equipment suppliers (WLAN card, AP, and Bridge): Samsung Electronics, Acrowave, IP One (SK Telecom), Avaya Korea, 3Com, Agere Sytems Korea, Intel Korea </li></ul>Nespot Swing, a bundling service between WLAN and CDMA NW by KT, has 98,000 subscribers as of 11.05 Recently, WLAN is adopted in Sony Play Station and MP3 Phones. With development of DBDM, WLAN and Wibro will be converged in to one terminal in the future WLAN Subscribers VoIP over WLAN + CDMA (or HSDPA) is under development by KT and Samsung
    78. 78. 4 . Future Technology 4.1 4G 4.2 UWB 4.3 MIMO 4.4 Handover UWB,4G( plans for allocating 4G frequencies), MIMO, Handover Issue
    79. 79. 4.1 4G
    80. 80. 4G <ul><li>In the 4G, data can be transmitted at the speed of 100Mbps while moving and 1G while not moving. </li></ul><ul><li>MIC selected 4G as one the 10 new growth engines in 2003 </li></ul><ul><li>Government, Industry, and Academia jointly work on 4G regarding development of source technology and standardization. In the center of it, ETRI, the central State-funded R&D organization in the telecommunications, has been developing 4G broadband wireless packet transmission technology since 2002. </li></ul><ul><li>Goal, Strategy, and Timetable : </li></ul><ul><li>2005 Develop commercial WiBro products </li></ul><ul><li>Develop 100Mbps-level Wireless Transmission Test System </li></ul><ul><li>2007 Develop 3G Evolution prototypes </li></ul><ul><li>2010 Develop 4G mobile communications source technologies </li></ul><ul><li>By 2010, the next generation mobile communications market is expected to create 103 trillion KRW (817 million EUR) in production. </li></ul><ul><li>Handover among various networks is critical in order to realize 4G. </li></ul><ul><li>Frequency spectrum under review for 4G : </li></ul><ul><li>Korea & Europe 2700-5860MHz </li></ul><ul><li>USA 698-806MHz </li></ul><ul><li>Japan 3400-4200, 4400-4900MHz </li></ul><ul><li>Industry in Korea expects 4G spectrum to be allocated from 2007 and commercialized from 2010. </li></ul>
    81. 81. Technology Development in ‘Beyond 3G’ <ul><li>R&D in 4G Mobile Communications Technology </li></ul><ul><li>By 2007, develop packet wireless transmission technology, test system, and related wireless LAN technology that allows 100Mbps speed. Core R&D areas for this are broadband wireless transmission technology, broadband wireless LAN technology, and mobile soft network technology. </li></ul>-ALL-IP-based base station technology -4G mobile handset platform technology Mobile soft network -Wireless transmission / access spec for next generation wireless LAN -Next generation wireless LAN modem and RF technology Next generation broadband wireless LAN <ul><li>Broadband packet wireless transmission/access spec </li></ul><ul><li>Broadband wireless transmission modem </li></ul><ul><li>Smart antenna, MIMO, MUD, High efficiency modulator </li></ul><ul><li>Wideband RF components technology </li></ul>Broadband wireless transmission 4G Mobile Component Technology Core R&D Area
    82. 82. Technology Development in ‘Beyond 3G’ <ul><li>Intelligent Converged Mobile Terminal Technology </li></ul><ul><li>In the next generation mobile communication, mobile terminal must support multiple modes and high performance. </li></ul><ul><li>Ultra small/ultra low power consuming component technology </li></ul><ul><li>Bio recognition technology </li></ul><ul><li>Self recharging technology </li></ul>Intelligent Mobile Terminal Component Technology <ul><li>Intelligent micro browser technology </li></ul><ul><li>small/low power consuming game engine technology </li></ul><ul><li>small/low power consuming media processor technology </li></ul>Converged Mobile Terminal Component Technology Intelligent Converged Mobile Terminal Component Technology Core R&D Area
    83. 83. Technology Development in ‘Beyond 3G’ <ul><li>Core Parts Technology for Multimedia Human-Friendly Mobile Terminal </li></ul><ul><li>Develop core source technology and core parts such as digital camera module, music source parts for multimedia mobile terminals. For this, develop SoC parts technology and SoI (Silicon-on-Insulator) technology. </li></ul><ul><li>Voice/text recognition and switch chip </li></ul><ul><li>Video/Visual recognition and switch chip </li></ul><ul><li>Bio recognition sensor </li></ul><ul><li>Self recharge device </li></ul>Human-Friendly Mobile Terminal Parts Technology <ul><li>DVD-quality MPEG4 codec </li></ul><ul><li>VGA CCD sensor for mobile phone </li></ul><ul><li>Codec for sound effect and voice processing </li></ul><ul><li>32bit A/D, D/A one-chip </li></ul><ul><li>multimedia processor </li></ul>Multimedia Mobile Terminal Parts Technology Core Parts Technology for Multimedia Human-Friendly Mobile Terminal Component Technology Core R&D Area
    84. 84. Technology Development in Beyond 3G <ul><li>Ultra Low Power Consuming RF/HW/SW Module Technology for Mobile Terminal </li></ul><ul><li>Develop technology for low power consuming RF/HW/SW that prolongs the life of battery 100 times </li></ul><ul><li>RF/HW/SW integration for power saving </li></ul><ul><li>Power saving in multimedia communication protocol, system SW, Application SW </li></ul><ul><li>HW integration (SoC) and low power consumption technology </li></ul><ul><li>Integration of analogue device and communication signal processing module and low power consumption technology </li></ul><ul><li>Integration of Wideband RF devices (MMIC) and low power consumption technolgoy </li></ul>Ultra Low Power Consuming RF/HW/SW module technology for mobile terminal Ultra Low Power Consumption Technology for Mobile Terminal Component Technology Core R&D Area
    85. 85. 4.2 UWB (Ultra Wide Band)
    86. 86. R&D of UWB in Korea <ul><li>UWB Chipset R&D in Korea </li></ul><ul><li> </li></ul><ul><li>Other R&D Players in the UWB in Korea </li></ul>ETRI <ul><li>Has been developing both MB-OFDM and DS-CDMA chipsets since 02. 2002 </li></ul><ul><li>Completed development and test of MB-OFDM chipset in 09.2005 </li></ul><ul><li>Plans to make a demo for 220Mbps in 11.200 </li></ul><ul><li>Plans to complete development of DS-CDMA chipset by the yearend </li></ul>SAIT <ul><li>SAIT works with ETRI for MB-OFDM </li></ul><ul><li>Samsung is a founding member of MBOA and Wireless USB Promoter Group </li></ul>Korea Electrotechnology Research Institute Korea Electronics Technology Institute Radio Research Laboratory Impulse signal generator Designing chipset for UWB modem Regulation of Korean UWB industry & Measurements of UWB signals
    87. 87. UWB-related Patent Number of UWB-related patents that have been registered and opened to public as of April 2003 in Korea, Japan, Europe, and USA. <ul><li>Of the 24 patents of Korea in the UWB, about 50% is patented by foreign companies. </li></ul><ul><li>Korea’s UWB technology falls behind compared to Japan and USA </li></ul><ul><li>However, Samsung is very active in standardization of UWB within the IEEE 802.15 working group </li></ul><ul><li>Korean government, public R&D Centers, and private companies are actively pursuing UWB technology and commercialization </li></ul>
    88. 88. Current Status of UWB in Korea <ul><li>Frequency allocation for UWB in Korea </li></ul><ul><li>- MIC and ETRI plans to draw a Korean UWB frequency allocation policy by the yearend </li></ul><ul><li>- ETRI obtained a permission from MIC for UWB test center at the frequency spectrum of 3.1~10.6GHz </li></ul><ul><li>- MIC granted Korea UWB Forum together with Home Network industry a permission to use test frequency spectrum at 3.1~5GHz </li></ul><ul><li>Working Groups in Korea </li></ul><ul><li>- Korea UWB Forum : About 70 companies are working in the Forum under the MIC to work out standardization and frequency use and policy for UWB </li></ul><ul><li>- UWB Industrial Application Standardization Forum under the Ministry of Commerce, Industry, and Energy </li></ul><ul><li>Companies in the UWB forefront </li></ul><ul><li>- Samsung Electronics : UWB chipset, modem terminal, and other component technologies for digital convergence and Home Networking. A trial mobile phone and wireless TV adopted FreeScale’s chipset </li></ul><ul><li>- LG Electronics : Developing digital devices including mobile phones ported with UWB chips from 2005 </li></ul><ul><li>Commercialization of UWB chipset in Korea </li></ul><ul><li>Current status is showing only a possibility of commercialization. Commercially working UWB chipset products can be released from early 2007 at the earliest, according to ETRI </li></ul><ul><li>International Cooperation among Korea, Japan, and China on UWB is under way </li></ul>
    89. 89. 4.3 MIMO (Multi-Input Multi-Output)
    90. 90. MIMO <ul><li>Samsung who is most active in 4G standardization has about 220 4G-related patents. Samsung hires 165 R&D engineers specialized in 4G and plans to 420 bil KRW in 4G. 40 employees of Samsung (125 in Korea and 40 overseas) are actively participating in 4G international standardization activities. In line with this, Samsung is developing core technologies such as MIMO, OFDMA, MC-CDMA, OFDAM, Error Correction in order to acquire 4G-related IPRs. </li></ul><ul><li>LG Electronics is developing MIMO jointly with Stanford University of USA. </li></ul><ul><li>IT-SoC Design Technology Lab of Yonsei University developed next generation WLAN chip at the speed of 250~500Mbps. In the process of the chip development, the Lab acquired 2 patents in MIMO and OFDM technologies. </li></ul><ul><li>Samsung, LG, and ETRI are expected to release next generation mobile communication system design adopting OFDM and MIMO during 2H of 2006. </li></ul><ul><li>Wibro already adopts OFDM as a core technology. MIMO technology is to be adopted when Wibro service is commercially available as a natural technological evolution. </li></ul><ul><li>In June 2005, Wibro 2 nd phase standards that enables 50Mbps downstream were fixed. Wibro 2 nd phase standards specify MIMO and smart antenna. </li></ul><ul><li>Nortel plans to release HSUPA using MIMO and OFDMA in 2007-2008. </li></ul><ul><li>In June, 2005, Samsung released a lap-top computer with WLAN card adopting MIMO (Sense X20 –insert a picture) which is 4 times faster than existing products. </li></ul>
    91. 91. 4.4 Handover
    92. 92. Handover Issue <ul><li>Handover is one of the main issues that hinders WCDMA in Korea. </li></ul><ul><li>Mobile operators and handset manufacturers have come to an agreement on the Handover technology IPRs. Samsung, LG, and KTF agreed on cross license regarding the Handover technology. ETRI and TTA will work on the national standardization for WCDMA Handover technology </li></ul><ul><li>KTF announced in August 2005 that it would develop, together with Agilent, a chipset supporting, specifically, Handover. </li></ul><ul><li>Only Voice Handover function has been commercialized. Development of Data handover technology will be completed next year. </li></ul><ul><li>There is a strong demand for Handover technology in Korea. Handover is essential in deploying not only CDMA2000 and WCDMA in the short-term, but also Wibro and HSDPA which are bridging 3G and 4G in the mid-to-long term. Currently, there is no standards fixed for CDMA-WCDMA Handover and Wibro-HSDPA Handover. </li></ul><ul><li>Handover-related patents in the terminal area by Korean companies such as SK Telecom amount to 40 (as of April 2005). When network system is included, the number reaches about 80 to 90. </li></ul>
    93. 93. Handset with Handover <ul><li>Samsung Electronics </li></ul><ul><li>Only Samsung has so far released DBDM handsets for domestic market. By 1H of 2005, only 3 DBDM WCDM mobile phone models were released by Samsung. </li></ul><ul><li>Samsung W-120 (insert picture) Released in March 2005 </li></ul><ul><li>Samsung is developing Wibro terminal with Handover that supports internet at 120Km/h moving speed. </li></ul><ul><li>LG and Pantech </li></ul><ul><li>LGE and Pantech will release DBDM phone early 2006 </li></ul><ul><li>System with Handover </li></ul><ul><li>Samsung and POSData are developing Wibro system to support Handover </li></ul>Samsung SCH-W120 <ul><li>1.3M pixel digital camera </li></ul><ul><li>PM3 player </li></ul><ul><li>Handover </li></ul><ul><li>Video mailbox </li></ul><ul><li>64 Poly-sound </li></ul>
    94. 94. 5 . R&D 5.1 Public Sector R&D Activities 5.2 Private Sector R&D Activities 5.3 R esearch in Optimizing the Use of Frequency Spectrum
    95. 95. 5.1 Public Sector R&D Activities
    96. 96. Budget for Public Sector R&D Activities <ul><li>National Budget for Public R&D Activities (Unit: Trillion KRW) </li></ul><ul><li>Financing of the public R&D activities for 2006 </li></ul><ul><li>- government’s budget (from tax) 8,703 bil KRW (6.9 bil EUR) </li></ul><ul><li>- national bond 270 bil KRW (214 mil EUR) </li></ul><ul><li>Main support areas for 2006 : Mega projects that have large economic effect </li></ul><ul><li>- Next generation ‘growth engine’ - 21th century frontier business </li></ul><ul><li>- Venture start-up - Commercialization of mega R&D projects </li></ul><ul><li>Main mission for 2006 </li></ul><ul><li>(1) Strengthen development of source technology </li></ul><ul><li>1.45 tril KRW (1.15 bil EUR), 21.3% of the total, for basic and source technology in 2005 </li></ul><ul><li>1.73 tril KRW (1.37 bil EUR), 23.6% of the total, basic and source technology in 2006 </li></ul><ul><li>(2) Raise creative human resources in high and core technology </li></ul><ul><li>403.5 bil KRW (320 mil EUR), 132% increase from 2005 </li></ul>11.2 (8.9 bil EUR) 2009 9.2% Growth/annum 10.3 (8.2 bil EUR) 8.97 (7.1 bil EUR) 7.8 (6.2 bil EUR) 2008 2006 2005
    97. 97. <ul><li>Government’s Support for SMEs’ Innovative R&D in 2006 </li></ul>5 New Technologies in 2005 <ul><li>Total budget for supporting SMES’ Innovative R&D in 2006 is 12.4 trillion KRW (9.84 billion EUR), 4.5% growth from 2005 </li></ul><ul><li>State-funded R&D organizations selected 5 new technologies to be focused for 2005 </li></ul><ul><li>(1) UWB for Digital Home (being developed by ETRI) </li></ul><ul><li>(2) Fab production line system for next generation semiconductor (by KBSI) </li></ul><ul><li>(3) ‘Arirang II’, multi-purpose commercial satellite </li></ul><ul><li>(4) New concept electronic devices (by KIST) </li></ul><ul><li>(5) Single molecule and single cell control technology (KRISS) </li></ul>54.2% 46.3 (37) Expansion of Industrial Innovation Cluster 25% 18.6 (15) Consulting form SMEs 14.6% 165.8 (131) Development of Innovative Technology Growth from 2005 (%) Budget for 2006 (bil KRW, mil EUR)
    98. 98. 10 Mega Public R&D Projects, 1989-2004 <ul><li>Investments in 10 mega public R&D projects between 1989-2004 : </li></ul><ul><li>2.7 tril KRW (2.1 bil EUR) </li></ul>245.2 bil KRW (194.6 mil EUR) 1997-2004 Innovative R&D Promotion 224.2 bil KRW (178 mil EUR) 1994-2000 Multipurpose Commercial Satellite 210.1 bil KRW (166.7 mil EUR) 1996-2002 KTX (Korea Train Express) Technology 356.5 bil KRW (283 mil EUR) 1992-2001 Environmental Engineering Technology 265.6 bil KRW (211 mil EUR) 1999-2004 Civil-Military Multipurpose Technology 155.2 bil KRW (123 mil EUR) 1992-1997 New Medicine and New Pesticide Technology 648 bil KRW (514 mil EUR) 1997-2004 Building of Techno Park 194.6 bil KRW (154 mil EUR) 1993-1996 Next Generation Semiconductor 182.4 bil KRW (145 mil EUR) 1995-2001 Next Generation TFT LCD 219 bil KRW (174 mil EUR) 1989-1996 Commercialization of CDMA technology Investment Period Project
    99. 99. Major Public R&D Centers <ul><li>ETRI ( www.etri.re.kr ) </li></ul><ul><li>The leading State-funded R&D organization in Korea. </li></ul><ul><li>Main R&D Area : </li></ul><ul><li>(1) Basic Research </li></ul><ul><li>(2) Future Technology </li></ul><ul><li>(3) Mobile Communications </li></ul><ul><li>(4) Digital Broadcasting </li></ul><ul><li>(5) Digital Home </li></ul><ul><li>(6) Intelligent Robot </li></ul><ul><li>(7) Telematics-USN </li></ul><ul><li>(8) BcN </li></ul><ul><li>(9) Digital Contents </li></ul><ul><li>(10) Information Security </li></ul><ul><li>(11) IT Service </li></ul><ul><li>(12) Embedded Software </li></ul><ul><li>KETI( www.keti.re.kr ) </li></ul><ul><li>KETI organizes the overall development of key electronic components and systems </li></ul><ul><li>Main R&D Area : </li></ul><ul><li>(1) Electronic Components Materials </li></ul><ul><li>- Electronic Materials & Packaging </li></ul><ul><li>- Wireless Components &Telecommunications </li></ul><ul><li>- Information Display </li></ul><ul><li>- Artificial Intelligence & Mechatronics </li></ul><ul><li>- Reliability & Failure Analysis </li></ul><ul><li>(2) Nano Fusion Technology </li></ul><ul><li>- Nano mechatronics </li></ul><ul><li>- Nano scale quantum devices </li></ul><ul><li>- Nano tech based information & energy storage </li></ul><ul><li>- Nano Bio </li></ul><ul><li>(3) Digital Convergence </li></ul><ul><li>- SoC </li></ul><ul><li>- Digital Media </li></ul><ul><li>- Ubiquitous Computing </li></ul><ul><li>- Intelligent IT System </li></ul><ul><li>- DxB-Communication Convergence </li></ul><ul><li>- Wireless Network </li></ul>
    100. 100. Major Public R&D Centers <ul><li>RRL ( www.rrl.go.kr ) </li></ul><ul><li>RRL’s focused research area is the development of radio wave resources including interference analysis, the protection of radio wave environment, and technical regulations for IT equipment, in particular the development of new policies of radio technologies. RRL also issues certificates of type approval for information and communication equipment. </li></ul><ul><li>Main R&D Area </li></ul><ul><li>(1) Radio Wave Resources </li></ul><ul><li>(2) Radio Environment and Electromagnetic Field (EMF) Safety Standards </li></ul><ul><li>(3) Technical Regulations on telecommunications, radio-communication and broadcasting. </li></ul><ul><li>(4) Radio Wave Environment Forecast </li></ul><ul><li>KERI ( www.keri.re.kr ) </li></ul><ul><li>Main R&D Area </li></ul><ul><li>(1) Electric Power </li></ul><ul><li>- Power system </li></ul><ul><li>- Instrumentation & Control </li></ul><ul><li>- Electrical Environment & Transmission </li></ul><ul><li>- Underground System </li></ul><ul><li>(2) Industry Applications </li></ul><ul><li>(3) Advanced materials & Application </li></ul><ul><li>(4) Testing & Evaluation </li></ul><ul><li>(5) Electrical Testing & Research </li></ul>
    101. 101. Major Public R&D Centers <ul><li>IITA ( www.iita.re.kr ) </li></ul><ul><li>One of the core State-funded organization in IT839. </li></ul><ul><li>Main functions </li></ul><ul><li>(1) IT R&D Planning and Assessment </li></ul><ul><li>(2) IT Information Service </li></ul><ul><li>(3) Technology Transfer Service </li></ul><ul><li>(4) IT Human Resources Development </li></ul><ul><li>(5) Fund Management </li></ul><ul><li>3 Main business IITA is pursuing in 2005 and its budget: </li></ul><ul><li>(1) Support and R&D for IT839 : 633.7 bil KRW </li></ul><ul><li>(2) Human Resource Development : 107.8 bil KRW </li></ul><ul><li>(3) Financial Support for SME & venture start-ups’ R&D : 26 bil KRW </li></ul><ul><li>KIST ( www.kist.re.kr ) </li></ul><ul><li>Main R&D Area : </li></ul><ul><li>(1) Future Technology </li></ul><ul><li>(2) Materials Science and Technology </li></ul><ul><li>(3) Systems Technology </li></ul><ul><li>(4) Environment & Process Technology </li></ul><ul><li>(5) Life Science Technology </li></ul><ul><li>KIST has two types of programs: Institutional and Governmental </li></ul><ul><li>(1) Institutional Program focusing on core technologies for the future demand </li></ul><ul><li>- Nano devices/microelectronics technology </li></ul><ul><li>- Intelligent Human Computer Interaction </li></ul><ul><li>- Micro system </li></ul><ul><li>- Bio-active lead compounds </li></ul><ul><li>- Sustainable environment technology </li></ul><ul><li>(2) Government Program </li></ul>
    102. 102. Major Public R&D Centers <ul><li>KRISS ( www.kriss.re.kr ) </li></ul><ul><li>KRISS participates in a wide range of R&D projects relating to standards as well as measurement science and technology. </li></ul><ul><li>Main Functions </li></ul><ul><li>- Establishment of National Measurement Standards </li></ul><ul><li>- R&D on Measurement Science </li></ul><ul><li>- Dissemination of National Measurement Standards </li></ul><ul><li>Current Main R&D Area : </li></ul><ul><li>- Basic Research Projects Funded by Government: </li></ul><ul><li>* establishment of national measurement standards and mutual recognition of national measurement standards </li></ul><ul><li>* development of applied technologies for measurement science </li></ul><ul><li>* dissemination of national measurement standards </li></ul><ul><li>* improvement of the reliability of industrial measurement standards </li></ul><ul><li>- Contracted Research Projects with the Ministries of Government </li></ul><ul><li>* high-temperature superconductor technology </li></ul><ul><li>* establishment of vacuum technology infrastructure </li></ul><ul><li>* development of man-made disaster prevention technology </li></ul><ul><li>* microstructure technology </li></ul><ul><li>* testing and evaluation technology for mechanical properties of ceramics </li></ul><ul><li>* standardization of nano-measurement technology </li></ul><ul><li>* infrastructure of measurement standards for thermal properties </li></ul><ul><li>- Contracted Research Projects with Other Government Agencies and Industries </li></ul><ul><li>* metrology for 50nm </li></ul><ul><li>* standardization of thin film measurement technology using spectroscopic ellipsometer </li></ul><ul><li>* development of reference system for calibration of Alpa, Beta emitting CRMs </li></ul>
    103. 103. Coordination of R&D activities <ul><li>In 2004, the government introduced Project Managers for each new growth engine sector and a Planning Evaluation Commercialization & Marketing (PECoM) system that can standardize and manage the entire R&D process. </li></ul><ul><li>PMs manage the entire process of the project from planning to commercialization with an aim to generate more successful R&D results and to increase synergistic effects between the government and the private sector. </li></ul><ul><li>Focus of PECoM is from progress management to the overall process of project planning, evaluation, and follow-up. </li></ul><ul><li>The government will continue to engage in international joint research to develop core source technologies by attracting advanced foreign R&D centers from the global companies like IBM, Fraunhofer and Intel </li></ul>
    104. 104. 5.2 Private Sector R&D Activities
    105. 105. R&D Investment by Source Unit: billion KRW (mil EUR) R&D Investment by Area Unit: billion KRW (mil EUR) Source: Ministry of Science and Technology,2005 Source: Ministry of Science and Technology, 2005 25:75 26:74 27:73 27:73 28:72 30:70 28:72 A:B (%) 1.0 2.64 2.53 2.59 2.39 2.25 2.34 To GDP(%) 16,630 (1,320) 14,114 (1,120) 12,509 (9,928) 11,673 (9,264) 10,023 (7,955) 8,340 (6,619) 8,285 (6,575) Private (B) 5,446 (4,322) 4,876 (3,870) 4,740 (3,762) 4,362 (3,462) 3,817 (3,029) 3,574 (2,837) 3,052 (2,421) Public (A) 2004 2003 2002 2001 2000 1999 1998 22,185 (17,607) 14,074 (11,170) 4,712 (3,740) 3,999 (3,174) 2004 100% 63.4% 21.2% 15.3% % (2004) 12,336 (9,791) 11,188 (8,880) 10,010 (7,944) 8,732 (6,930) 7,231 (5,739) 6,903 (1,784) Development Research 19,069 (15,134) 17,325 (13,750) 16,111 (12,786) 13,849 (10,991) 11,922 (9,462) 11,337 (8,997) Total 4,076 (3,235) 2,025 (1,607) 2001 3,764 (2,989) 2,373 (1,883) 2002 3,974 (3,154) 2,759 (2,189) 2003 3,370 (2,675) 3,065 (2,433) 2,848 (2,260) Application Research 1,746 (1,386) 1,626 (1,290) 1,585 (1,258) Basic Research 2000 1999 1998
    106. 106. 5.3 Research in Optimizing Frequency Spectrum
    107. 107. Optimization of Frequency Spectrum <ul><li>MIC is setting out a mid-to-long term operation plan for frequency use </li></ul><ul><li>Frequency Spectrum Policy Advisory Council was formed in March 2005 to discuss Government’s mid-to-long term frequency policy direction. The Council is composed of government, industry, academia, and research institutions. </li></ul><ul><li>MIC is working on spectrum management policy that can maximize efficiency in spectrum use by way of spectrum sharing technologies such as CR (Cognitive Radio), SDR (Software Defined Radio), and UWB. </li></ul>MIC’s efforts in frequency management system 2005-2006 8.25 bil KRW (1) Upgrading frequency resource analysis system 9.75 bil KRW Investment 2007-2008 <ul><li>(2) Build Spectrum policy support system </li></ul><ul><li>Build a Portal for Radio Wave management and policy support </li></ul><ul><li>Build a data base for frequency policy </li></ul>Period Goals
    108. 108. Research in SDR, CR, and UWB <ul><li>SDR </li></ul><ul><li>As Korea is going to have various network technologies such as CDMA, WCDMA, CDMA 2000 EVDV, Wibro, and DMB, SDR has become a core technology issue. </li></ul><ul><li>HY-SDR Center of Han Yang University in cooperation with BrOMA Center of Pohang Technology University have been working on SDR technology. In May 2005, HY-SDR Center introduced a new base station that supports both Wibro and WCDMA by way of applying SDR to smart antenna. HY-SDR Center plans to complete the dual-mode base station technology for the first time by the end of 2005. Commercial product is expected to come by 2008. </li></ul><ul><li>HY-SDR Center is developing SDR system for base station and SDR applications for terminal in partnership with SandBridge Technologies of USA and PicoChip of UK. The Center is also leading international standardization activities in smart antenna base station technology using SDR. </li></ul><ul><li>HY-SDR Center works on RSP (Reconfigurable Signal Processing), SPS (Signal Processing Subsystem), Multi-Mode-Multi-Band antenna technology, RF front-end technology, Software Architecture technology, Terminal Reconfigurable Technology, Security and authentication technology, Digital IF technology. </li></ul><ul><li>KT is developing the dual-mode base station technology that supports both Wibro and WCDMA. </li></ul><ul><li>ETRI is developing CR and SDR technologies. </li></ul><ul><li>InnoWireless Co., Ltd ( www.innowireless.co.kr ) of Korea contracted a R&D project with IITA to develop SDR-based measurement equipment for Wibro. </li></ul><ul><li>UWB & CR </li></ul><ul><li>- TTA and Korea UWB Forum are working on UWB standardization in order to vitalize the UWB industry in Korea. UWB is in the very early stage in Korea </li></ul><ul><li>- ETRI’s suggestion to MIC on initial adopting CR technology is to introduce CR technology on the spectrum below UHF 3GHz. Before, adopting CR technology, MIC needs to reform regulations in a way to reduce the exclusive spectrum usage right (ownership) and allow free access to spectrum. </li></ul>
    109. 109. 6 . Contents
    110. 110. 6.1. Market Size of Mobile Internet Contents
    111. 111. Mobile Internet Contents Market Outlook in Korea Source: IDC, 2004 Unit: billion KRW (mil EUR) 28 6,598 (5,237) 5,872 (4,660) 4,976 (3,949) 3,905 (310) 2,830 (2246) 1,899 (1,507) Total 35 428 (340) 349 (277) 292 (232) 237 (188) 167 (133) 96 (76) Others 18 143 (113) 130 (103) 114 (90) 99 (79) 79 (62) 62 (49) Stock/Banking 18 119 (94) 119 (94) 117 (93) 114 (90) 108 (86) 98 (78) Lottery/Reservation 13 177 (140) 169 (134) 160 (127) 148 (117) 131 (104) 95 (75) Community 32 454 (360) 427 (339) 374 (297) 298 (237) 220 (175) 113 (90) Adult contents 61 1,327 (1,053) 1,160 (921) 916 (727) 644 (511) 337 (267) 123 (98) m-Commerce 33 896 (711) 794 (630) 667 (529) 520 (413) 335 (266) 213 (169) LBS 26 638 (506) 587 (466) 531 (421) 413 (328) 320 (254) 203 (161) Mobile game 53 433 (344) 356 (283) 259 (206) 156 (124) 77 (61) 52 (41) Mobile broadcasting 10 250 (198) 241 (191) 228 (181) 210 (167) 188 (149) 158 (125) Character download 35 370 (294) 314 (249) 262 (208) 197 (156) 121 (96) 82 (65) Ringback tone 11 132 (105) 125 (99) 115 (91) 104 (83) 90 (71) 78 (62) Ring tone 115 608 (483) 480 (381) 322 (256) 160 (127) 79 (63) 13 (10) MMS 4 626 (497) 622 (494) 618 (490) 605 (480) 578 (459) 513 (407) SMS ’ 03~08 CAGR(%) 2008E 2007E 2006E 2005E 2004E 2003
    112. 112. 6.2. Pricing of Mobile Internet
    113. 113. Pricing of Mobile Internet <ul><li>The most popular payment system for the wireless internet use is ‘time-based charge’ system (41%), followed by ‘access-based charge’, ‘fixed charge’, and ‘data packet-based charge’ with 20.4%, 19.9%, and 17.1% respectively. </li></ul>Source: Survey, National Internet Development Agency of Korea, Sept. 2004
    114. 114. 6.3. Popular Contents
    115. 115. Popular Mobile Internet Contents (multiple choice) Source: Survey, National Internet Development Agency of Korea, September 2005
    116. 116. Mobile Banking <ul><li>As of Dec. 2004, only 1.6% of internet banking users were using mobile banking service. However popularity of the service is growing very fast and it attracted 1.3 million subscribers as of Jun. 2005. </li></ul>Mobile Banking Service (IC Chip-based Service) (Unit: thousand) Source: LGT, Bank of Korea, <ul><li>Flat rate of 0.63EUR/month, 1.04 million subscribers </li></ul>Sep. 2003 BankOn LGT <ul><li>480,000 K-Bank handsets sold </li></ul>Mar. 2004 K-Bank KTF - 1,548,000 M-Bank capable handsets distributed - 600,000 subscribers as of Oct. 2004 Apr. 2004 M-Bank SKT Remarks Commercial Service Launch Brand Operator
    117. 117. IC-Chip-based Mobile Banking Subscribers Source: Bank of Korea, 2005 <ul><li>Mobile banking service enables users to do remittance, cash withdrawals and transportation fare payment through their IC chip-installed cellular phones, which were introduced in the market in September 2003 by LG Telecom with brand name “BankOn”. </li></ul>
    118. 118. Mobile Value-added Services Source: 2005 Korea Mobile Yearbook 0.71 EUR 0.71 EUR 0.79 EUR 0.02 EUR SKT Ring back tone/ month Call switchover/month CID/Month SMS/message Operator
    119. 119. Mobile Internet Shopping <ul><li>76.2% of mobile internet users have purchased services or goods through the mobile internet. </li></ul><ul><li>Downloading paid contents including ring tones, characters, and games is the most popular item in the mobile internet shopping with 96.3%. </li></ul>Source: Survey, National Internet Development Agency of Korea, Sept. 2004 (Multiple responses)
    120. 120. MUSIC <ul><li>Mobile music market growth driven by the popularity of ring tone and ring back tone is likely to continue by wire-wireless music streaming/download service through music portals. </li></ul><ul><li>MIDI ring tones are being replaced by MP3 tones which allow users to enjoy original sound. </li></ul><ul><li>The size of mobile music market in 2004 was nearly 400 million EUR. </li></ul>Music Portal Service by Operator Source: 2005 Korea Mobile Yearbook 200,000 with 70,000 paid subscribers (as of Sep. 2005) Dec. 2004 MusicOn (www.musicon.co.kr) LGT 350,000 with 120,000 paid subscribers (as of Jun. 2005) May 2005 Dosirak (www.dosirak.com) KTF 2 million with 470,000 paid subscribers (as of Jun. 2005) Nov. 2004 MelOn (www.melon.com) SKT Subscriber Commercial Launch Brand Operator Mobile Music Market Size (Unit: million EUR) 357~400
    121. 121. GAME <ul><li>Korean mobile game market has been growing at an annual rate of 40-50% and is valued at 240 million EUR in 2005. It is about 10% of the entire game make of Korea. </li></ul><ul><li>Advanced mobile networks and handsets enabled mobile network games and 3D/LBS games through downloading or mobile portals such as GXG(SKT) and GPANG(KTF). </li></ul><ul><li>Mobile operators introduced more than 1,500 new mobile games in 2004 and also a flat rate mobile data fee to boost the market. </li></ul><ul><li>More than 500 game developing companies are fiercely competing in the domestic market. </li></ul>(Unit: mil EUR) Market Share Source: 2004 Korea Game White Paper Revenue and Growth Rate of Mobile Game
    122. 122. Multimedia (Character, Photo and Moving Image) <ul><li>Revenue from simple download of characters and pictures, which was the major income source, declined rapidly since late 2003 when camera phones were widely distributed. </li></ul><ul><li>Operators are introducing and developing replaceable services such as SKT’s PhotoOn allowing users to upload/download their own photos on/from the mobile internet. </li></ul><ul><li>Users decorate mobile handset screens with their own photos taken by camera phones. This trend resulted in the market size reduced since using own photos costs little. </li></ul>Moving Image Broadcasting Service by Mobile Operator - Multimedia broadcasting service providing news, sports, music, adult, TV programs through ARS, moving image, and text Oct. 2002 MI -TV LGT - MS, MagicN multi message, HD moving image download, streaming VOD May 2002 Fimm KTF <ul><li>- Mobile multimedia broadcasting service providing information on a real-time basis through cdma2000 1x color handsets </li></ul><ul><li>Weather forecasting, news, entertainment, adult contents </li></ul>Feb. 2002 Nate Air <ul><li>Streaming video multimedia service with 3G network: </li></ul><ul><li>VOD, MOD, video phone, multimedia message, TV broadcasting </li></ul>Nov. 2002 June SKT Remarks Commercial Launch Brand Operator
    123. 123. Adults <ul><li>Mobile adult contents is one of the killer applications along with mobile game resulting in a growth of nearly 100% from the previous year. </li></ul><ul><li>Adult contents market started growing from 2002 when cdma2000 1x EV-DO service was launched in the country. </li></ul><ul><li>Operators’ adult contents sales accounted for 5% (SKT and LGT) and 10% (KTF) of the total wireless internet contents sales in 2004. </li></ul><ul><li>Photos, novels, and blind dating & chatting are most loved contents by users. Other currently available contents are moving images, comics, and games. </li></ul><ul><li>Blind dating & chatting service accounts for 25-30% of the total mobile adult contents sales. </li></ul>Source: 2004 SKVM Festival Forum Mobile Adult Contents Sales and Forecast (Unit: million EUR)
    124. 124. Telematics Source: ETRI, Mobile Operators Earnings Release - Connection via ez-I mobile internet Sep. 2004 ez-Driver LGT <ul><li>Road guidance service and information on safety drive </li></ul><ul><li>Voice navigation & three dimensional map </li></ul>May 2004 K-ways KTF - For Hyundai-Kia Motors’ before market service Nov. 2003 MOZEN <ul><li>cdma2000 1x EV-DO network /Before market service </li></ul>Feb. 2005 Ever-way <ul><li>- First mobile phone-based telematics service in Korea </li></ul><ul><li>- NATE mobile internet & telematics converged service </li></ul><ul><li>260,000 subscribers as of Dec. 2004 (90% market share) </li></ul>Mar. 2002 NATE Drive SKT Remarks Commercial Launch Brand Operator 44.2~86.2% 10.5~29.7 7.7~16.7 5.2~10.3 3.5~4.6 Total 40.4~89.4% 3.6~11.1 2.5~6.2 1.7~3.8 1.3~1.4 Service Market 46.4~79.8% 6.9~18.6 5.2~10.5 3.5~6.5 2.2~3.2 Terminal Market CAGR 2007 2006 2005 2004 (Unit: 100 m USD)
    125. 125. 7. Government
    126. 126. 7.1 Government’s Role
    127. 127. Role of Government <ul><li>MIC functions as a goal setter for the nation’s long-term IT vision and project manager of the Korean ICT industry, especially in the mobile communications. </li></ul><ul><li>MIC identifies growth engines for boosting the ICT industry, and thus stimulating national economy. </li></ul><ul><li>In order to achieve the national goals : </li></ul><ul><li>- induces investments in vitalization of new services from private companies </li></ul><ul><li>- makes its own advance investments </li></ul><ul><li>- initiates trial projects </li></ul><ul><li>- reforms and improves regulation </li></ul><ul><li>- strengthen global competitiveness through attracting foreign R&D centers </li></ul><ul><li>- puts its budget into development of core technologies </li></ul><ul><li>- builds and expands R&D networks. </li></ul><ul><li>‘ IT839’ strategy was set by MIC as a concrete national industrial policy to achieve the followings ; </li></ul><ul><ul><li>- Introduce and promote eight new services </li></ul></ul><ul><ul><li>- Lead to investment in and building of three infrastructures </li></ul></ul><ul><ul><li>- Result in the development of nine new IT growth engines </li></ul></ul>
    128. 128. Key Players in the Telecom Industry Policy : KISDI Technology : ETRI MIC KCC : Arbitrary Inquiry Investigation Regulatory Agency Research Institute Mobile: SKT, KTF, LGT Fixed : KT, Hanaro, Dacom WLAN : KT, Hanaro Policy Maker Telcos
    129. 129. 7.2 IT839
    130. 130. What is IT839? Goal: Home networks in 60% of households by 2007 Goal: 10 million Telematics service users by 2007 Source: MIC IT839
    131. 131. Composition of BcN (Broadband Convergence Network) Source: National Computerization Agency (NCA) Application Service Open API Qos Security IPv6 Core Infrastructure to Realize a User-Friendly Ubiquitous Service Environment Home Network USN Convergence Information Devices Wired and wireless Voice and data Telecommunications & Broadcasting Fixed-line Communication BcN Wireless Communication Telephone Internet CATV DMB
    132. 132. Goals and Strategy of BcN <ul><ul><li>Commercial service to begin I 2006. </li></ul></ul><ul><ul><li>Establish BcN by 2010 that provides quality services at the speed of 50 to 100Mbps to 20 million fixed and wireless subscribers. </li></ul></ul><ul><ul><li>The BcN will support quality of service (QoS), security and IPv6 and extend various convergent services. </li></ul></ul><ul><ul><li>A high-tech R&D network will be established to develop and verify core technologies for the BcN. Pilot projects will be carried out. </li></ul></ul><ul><ul><li>Develop and distribute a wide range of applications and revise relevant laws and regulations to create a favorable environment for the BcN. </li></ul></ul><ul><li>Expected results by 2010 </li></ul><ul><ul><li>Create 370,000 new jobs </li></ul></ul><ul><ul><li>Generate 13.5 billion USD of exports </li></ul></ul><ul><ul><li>Generate 95 trillion KRW of equipment and service production. </li></ul></ul><ul><ul><li>Stimulate private investment amounting to 67 trillion KRW </li></ul></ul><ul><ul><li>Provide high-tech services such as e-Learning, e-Health, home network and VOD services via convergent terminals. </li></ul></ul>
    133. 133. Time Table for BcN
    134. 134. 8. Terminal
    135. 135. 8.1. Mobile Phone Platform
    136. 136. Mobile Internet Platforms in Korea <ul><li>5 different mobile internet platforms for 3 mobile operators </li></ul><ul><li>CPs must customize one content according to 5 different platforms, thus increasing the development cost and delaying time-to-market </li></ul><ul><li>With the drive from the government and CPs, efforts to standardize the mobile internet platform have created a common platform called ‘WIPI’. </li></ul>WIPI <ul><li>What is Mobile Internet Platform? </li></ul><ul><li>An environment enabling download service of application programs </li></ul><ul><li>A middleware set between basic handset S/W </li></ul><ul><li>Make application programs H/W or basic S/W-independent </li></ul>KTF SKT KTF SKT LGT Operator Trial 10.2001 Binary ANSI-C/C++ Qualcomm BREW 07.2001 Script Java (MIDP) XCE SVM (SKVM) 05.2001 Binary ANSI-C Mobiletop MAP 10.2000 Script Mobile C Shinji Soft GVM (GNEX) 09.2000 Bi-code Java Sun KVM (J2ME) Launch Method Language Vendor Platform S/W Application S/W Browsers (WAP, ME, etc.) Platform: WIPI, BREW, GVM, KVM H/W HDD/RAM( 소용량 )
    137. 137. GNEX Architecture Event Handler Service APIs Platform Event Handler Mobile Interface Device Driver GNEX KERNEL GNEX Virtual Machine GNEX Application Manager GNEX Applications Event API call Fetch Loading Platform Or Native S/W GNEX Module GNEX Application Source: Korea Mobile White Paper, 2005
    138. 138. <ul><li>For Content Providers </li></ul><ul><ul><li>- Reduce costs for content development according to 3 different platforms of 3 operators by providing a set of common APIs (application platform interfaces). </li></ul></ul><ul><ul><li>- Allow Content Providers to focus on the substance of the contents </li></ul></ul><ul><li>For Handset Vendors </li></ul><ul><ul><li>- Eliminate redundant engineering for porting on different platforms by providing a set of common adaptation layer specification in order to reduce production costs and increase time-to-market </li></ul></ul><ul><ul><li>- Facilitate easier conformance to carrier requirements </li></ul></ul><ul><li>For Wireless Carriers </li></ul><ul><ul><li>- Facilitate simplicity and speed in deploying new services </li></ul></ul><ul><ul><li>- Timely delivery of handsets </li></ul></ul><ul><ul><li>- Form environment for quality contents </li></ul></ul><ul><ul><li>- Quality contents brings more data revenue </li></ul></ul><ul><li>For Subscribers </li></ul><ul><ul><li>- More quality contents </li></ul></ul><ul><ul><li>- Enjoy good contents regardless of service provider </li></ul></ul><ul><ul><li>- Ease of software upgrade </li></ul></ul>Goals of Standardization of Platform
    139. 139. Handset Hardware Application Manager (Java, C) HAL (Handset Adaptation Layer) BASIC API set (C and Java) Multi-Media Player (Java, C) Download Manager (Java, C) Browser ( Java, C) E-mail, PIMS, Other Apps. (Java, C) Handset Native Software Game (Java, C) Standard Platform Architecture : WIPI Standardization <ul><li>Scope of Standardization </li></ul><ul><li>HAL API Specification : Define a common adaptation layer spec in HAL (Handset Adaptation Layer) to facilitate hardware independence of the platform </li></ul><ul><li>API Specification for Contents : Define a common and rich set of APIs for application developers. The platform must support C and Java language </li></ul><ul><li>Functional specifications : Define major functionality of the platform </li></ul><ul><ul><ul><li>- Conversion of applications to machine code - Concurrent multiple application execution </li></ul></ul></ul><ul><ul><ul><li>- Programming language support - Security </li></ul></ul></ul><ul><ul><ul><li>- Platform capability upgrade (API download) - Memory management </li></ul></ul></ul><ul><ul><ul><li>- Application program management - Support for multiple languages </li></ul></ul></ul>
    140. 140. WIPI Roadmap 2004 2005 2006 2007 Network Technology Basic Functions & Device Service Support CDMA GSM WCDMA Wibro DMB Managing terminal Resources Camera DLL Generic I/O Voice sensor Bio sensor 3D support library XML SIP Support various codec Strengthen support for OS interface SMS VGI Phone book Web service Receiving Data broadcasting Support Wibro service Source: KWISF, Dec. 2004
    141. 141. 8.2. Technological Trend
    142. 142. Mega Trend in Mobile Phone <ul><li>“ Converged and integrated” </li></ul><ul><ul><li>Integrated with MP3, and digital camera </li></ul></ul><ul><ul><li>Converged with various network technologies </li></ul></ul><ul><ul><li>such as digital broadcasting, </li></ul></ul><ul><ul><li>Wibro, </li></ul></ul><ul><ul><li>WLAN, Bluetooth, IrDA etc. </li></ul></ul><ul><li>“ High-Performance & Smaller Components” </li></ul><ul><ul><ul><li>High-performance CPU and OS </li></ul></ul></ul><ul><ul><ul><li>One-chip solution type RF </li></ul></ul></ul><ul><ul><ul><li>Low power consuming </li></ul></ul></ul><ul><ul><ul><li>Fast recharge of battery </li></ul></ul></ul><ul><ul><ul><li>USB type WLAN module </li></ul></ul></ul><ul><ul><ul><li>High-performance speaker </li></ul></ul></ul><ul><li>“ Versatile and Easy User Interface” </li></ul><ul><li>Voice recognition </li></ul><ul><li>Touch screen </li></ul><ul><li>Soft touchpad </li></ul><ul><li>Fashionable </li></ul><ul><li>Wearable </li></ul><ul><li>IC-chip-based Payment </li></ul><ul><li>Health-phone </li></ul>
    143. 144. Component TRM
    144. 146. 8.3. Components
    145. 147. Market Leading Products of Korea D-RAM Semi-Conductor TFT-LCD Mobile Phone Korea 42% Korea 30% Korea 25%
    146. 148. Mobile Phone Antenna <ul><li>In 2003, three major local manufacturers, Ace Technology, EMW Antenna, and SBTelcom, extended their market share to 20% in the domestic market which had been dominated by foreign makers up to 50%. </li></ul>Trend in Antenna Export & Import (Unit: 1,000 USD) Source: KETI 2004, Korea International Trade Association 2005 Sales Development of Ace Technology (Unit: million EUR) 17,225 75,143 92,368 2005(1~5) 50,685 164,736 215,421 2004 14,080 140,422 154,502 2003 -8,148 112,563 104,415 2002 -20,939 113,737 92,798 2001 8,987 114,297 123,284 2000 -35,943 124,443 88,500 1999 -14,354 109,826 95,472 1998 -46,821 113,130 66,309 1997 1,360 62,044 63,404 1996 Trade Balance Import Export Antenna Market Share Sales 132 118 91.5 63.8 2004 2003 2002 2001
    147. 149. Camera Module <ul><li>In 2004, camera module sales in Korea reached 60 million units and is expected to be more than double in 2005. The market is likely to grow to 1.2 billion EUR in 2005 from 560 million EUR a year ago. </li></ul><ul><li>Main components of domestic camera phones show over 60% of localization. </li></ul><ul><li>Most camera module manufacturers succeeded in developing 5~7 megapixel products, however, their main items are still 1.3 and 2 megapixel products. </li></ul><ul><li>Korean companies have strong technology edge in CMOS image sensor rapidly replacing CCD. </li></ul><ul><li>Subminiature and high-powered camera modules are considered a most marketable segment due to the growth of slim camera phone market. Auto focus (AF) and optical zoom functions are one of latest focal areas of camera module makes. </li></ul><ul><li>Korean Megapixel CMOS Image Sensor makers: Pixelplus Co., Ltd. ( www.pixelplus.co.kr ), Samsung Electronics ( www.samsung.com ), MagnaChip ( www.magnachip.co.kr ). SiliconFile ( www.siliconfile.com ) </li></ul>Localization Rate of Main Components CMOS & CCD Ratio of Camera Phone Image Sensor (Forecast) Source: 2005 Korea Mobile Yearbook, Dongyang Investment Banks, Electronic Times, KETI 2004 Camera Phone Module Market Outlook (Unit: million EUR) - 100 IR Filter 81% Localization Rate - 100 FPCB - 100 PCB 33 67 Lens 34 66 Image Sensor Imported Domestic Adoption Rate (%) Component 160 123.8 86.6 95.2 122.2 2007 2006 2005 2004 2003 38% 62% 2006 35% 43% 44% CCD 65% 57% 56% CMOS 2007 2005 2004
    148. 150. 9. Foreseeable Radical Changes
    149. 151. Convergence Business <ul><li>The hot issue and new business considered ‘Blue Ocean’ in Korea is converged new services by way of integrating separate networks.. </li></ul>Broadcasting Communication DMB IPTV Mobile TV Web Casting Wireless Fixed WLAN Wibro Mobile Internet IP Multicasting Telephony Broadband Internet VoIP Mobile ‘ One-Phone’ WLAN UMA ‘ NESPOT Swing’ WVoIP
    150. 152. 10. Opportunities for Finnish Companies
    151. 153. Opportunities to be found in well advance <ul><li>Korea is moving toward where no other country has been in terms of wireless broadband service commercialization. Therefore, high-technologies to implement the new service roadmap are well sought by Korean government and private companies. </li></ul><ul><li>The mega trend in the Korean communications industry is ‘broadband wireless’, ‘convergence’, and ‘multimedia’. Therefore, solutions to implement the three keywords are where opportunities can be found for Finnish companies. </li></ul><ul><li>To converge different network technologies means needs for handover, smart antenna, and MIMO technologies. It also requires solutions for efficient use of frequency spectrum such as UWB, SDR, and CR. Broadband Convergence Network which is the core infrastructure to implement converged services needs network system such as Edge Router, MSPP (Multiservice Provisioning Platform), WDM (Wavelength Division Multiplexing) etc. Digital multimedia services requires stereoscope 3DTV system. Quite a substantial amount of required technologies for these areas come from foreign companies; </li></ul><ul><li>Technology Area Dependency on foreign technology </li></ul><ul><li>Edge Router 91% </li></ul><ul><li>Stereoscopic 3D TV system 90% </li></ul><ul><li>MSPP 85% </li></ul><ul><li>WDM 76% </li></ul><ul><li>Mobile phone 20~30% </li></ul><ul><li>Other technologies that are dependent on foreign source are chip for IP-DSLAM, RSOA ( Reflective Semiconductor Optical Amplifier) technology, WDM-PON core components, Multi-codec and control technology </li></ul><ul><li>A comprehensive study on mega projects that Korean government plans for the next 5 or 10 years and their required technologies needs to be carried out in order to identify the opportunities for Finnish companies. Solution providers in the world know that Korea is moving toward untried scene of new commercial communications services and has purchasing power. They are very fast in detecting the future plan and what are sought along the road. Early detection of opportunities, investment for market entry, joint R&D with Korean R&D Centers and private companies are essential. </li></ul>
    152. 154. 11. Appendix
    153. 155. Abbreviations <ul><li>HSDPA : High-speed Downlink Packet Access </li></ul><ul><li>HPi : High-speed Portable Internet </li></ul><ul><li>VoIP : Voice over Internet Protocol </li></ul><ul><li>OFDM :Orthogonal Frequency Division Multiplex </li></ul><ul><li>CDM : Code Division Multiplex </li></ul><ul><li>MMS: Multimedia Messaging Service </li></ul><ul><li>MNP: Mobile Number Portability </li></ul><ul><li>CID: Caller ID </li></ul><ul><li>CAGR: Compound Annual Growth Rate </li></ul><ul><li>WINC: Wireless Internet Numbers for Contents </li></ul><ul><li>RFID : Radio Frequency Identification </li></ul><ul><li>UWB : Ultra Wide Band </li></ul><ul><li>MIMO : Multi-Input, Multi-Output </li></ul><ul><li>EVDO : Evolution Data Only </li></ul>IDR : Internet Detailed Record AAA : Authentication, Authorization, Accounting Subscriber authentication, data billing PAS : Personal Access System VMS: Voice Messaging System PDSN : Packet Data Service Node HA : Home Agent IWF : Inter Working Function HLR : Home Location Register VLR : Visitor Location Register MSC: Mobile Switching Center RSOA : Reflective Semiconductor Optical Amplifier IP-DSLAM: Digital Subscriber Line Access Multiplexer