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 .
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.
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.
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.
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.
Exchange rate is 1260 KRW for 1EUR
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
Low interoperability and synchronization among terminals
emphasis on electronic data processing
Broadband internet service
Networking among some IT products
Various converged IT services
Universal IT integration & Universal networking
Broadband network technology : Digital convergence technology
Trial services in July ‘05
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
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
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
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.
Source: MIC (Ministry of Information and Communication of Korea
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
Mobile Service Operators and Market Share (Year 2004) Source: SK Telecom Market Share by Operator
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.
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
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
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
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.
(Unit: million EUR) Source: Electronic Times
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)
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.
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.
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.
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
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.
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%).
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.
ITU approved EVDO as one of 3G technologies.
Services on EVDO are rich multimedia contents.
Current EVDO services of SKT and KTF use CDMA20001x network for voice calls and EVDO network for high-speed data service.
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
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
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
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)
- Total subscriber : 9.6M
- KT’s Subscriber : 3.1M
- ARPU : 33,000KRW(30EUR)
Turnover: 1.2 tril KRW (1 bil Euro) in 2010 for KT itself
Accumulated investment : 1.2 tril KRW (1 bil EUR)
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
Preferred services :MMS, file transactions, email = add mobility to fixed broadband internet
Preferred tariffs : monthly flat at around 30,000KRW (25 Euro)
Popular contents :
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
HSDPA first, and then Wibro comes later as a supplement to HSDPA.
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.
Plans for trial service in June 2006
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.
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
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.
SK Telecom’s Business Overlap SK Networks SK Communications Widerthan.Com TU Media Wibro HSDPA DMB june/NATE (CDMA) Mobile TV W-internet MMS
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
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
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
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
Maximize spectrum efficiency (bit/Hz/sector)
-maximize average cell & user throughput
-minimize # of effective active users per sector
-Minimize peak to average power ratio
-Optimize power amp.output power
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
Wibro System Structure Access Terminal Access Point Access Point Access Point Packet Access Router Packet Access Router
Functions of AT :
Low power consumption RFIF module and controller
- MAC frame control according to frequency environment & service specifications
Authentication and encryption
measurement and filtering control
Functions of AP:
Low power RF/IF module and controller
OFDMA/TDD packet scheduling and channel multiplexing
MAC frame control according to frequency environment & service specifications
Real time control of 50Mbps-level high traffic
Functions of PAR :
Handover control among Access Points
Handover control among Packet Access Routers
Functions of AT and AP : -Alteration of 50Mbps packet transfer -Coding of high speed packet channel -Real time modem control
CD quality audio and multimedia broadcasting and communications services on the mobile through mobile phone, PDA, and other portable terminals
Two technologies : Satellite and Terrestrial
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
Cooperate among DMB operators, terminal manufacturers, and mobile service operators in order to minimize costs
Economic Effect of DMB Service (Unit: billion KRW, 1000 people)
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
DMB Subscribers Outlook (Unit: million people) Source: SK Telecom and Korea Mobile White Paper 2005
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.
January 2005 with 3 video and 6 audio channels.
Number of channels
41 channels as of October 2005 (10 video and 30 audio channels)
TU Media has service agreement with all 3 mobile operators.
100,000 as of end of July, 2005 (93,400 for mobile phone and 6,600 for car terminal)
Investment by SK Telecom and TU Media between 2001 and 2004
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.
TU Media’s further investment plan for the next 5 years
Contents development 256 bil KRW (203 Mil EUR)
Support for broadcasting business 7 bil KRW (5 Mil EUR)
Commission to Program Providers 442 bil KRW (351 Mil EUR)
Paid-in-capital of TU Media as of May 2005 : 137 billion KRW (109 Mil EUR)
Projected break-even point : 2009
TU Media estimates that 2.5 million subscribers is the turning point to make a profit and 5.5 million to break-even.
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)
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)
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.
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.
DMB baseband chip for satellite DMB terminal is supplied by Toshiba, LG Electronics, and TelAce (a Korean venture start-up).
SPH-B2000 SCH-B200 SCH-B250 SCH-B130 Satellite DMB Phones by Samsung Electronics
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.
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.
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.
3 Non-Terrestrial Broadcasters - TYN DMB, Korea DMB, KMMB
Initial Service Deployment
Seoul and its neighbor cities were selected in March 2005
1.536MHz of frequency band is given to each operator.
Hurdles to terrestrial DMB
- too many operators (6) to compete in the small market
- huge costs to build Gap Fillers in the shadow areas
- lack of terminal distribution channel.
- lack of cooperation model with mobile operators
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
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
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.
Data service is done through a separate channel from the video or audio program.
BWS (Broadcast Web Site)
Transfer the whole of a website using DMB channel, to make it as if surfing a website.
EPG (Electronic Program Guide)
Transfer program information like the program guide on the newspaper.
MOT (Multimedia Object Transfer)
Transfer a multimedia object using DMB data channel.
Show pictures or cartoons is a Slide Show form.
DLS (Dynamic Label Segment)
Send text information about news, singers, lyrics, emergency, a prompt report, etc.
IP Datagram Tunneling
Encapsulate a bucket of data in a packet format and transfer it over IP.
Using IP Datagram Tunneling, page a certain group of subscribers having addresses through a Web server.
TMC (Traffic Message Channel)
Transfer traffic information in text while delivering traffic situation in video.
EWS (Emergency Warning System)
Automatically change channels when national emergency situations happen.
TTI (Traffic and Travel Information )
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.
DPGS (Differential Global Positioning System)
Integrate traffic info and electronic map with location-based information using GPS and send it to car navigation system.
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)
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.
LGT plans to build EVDO-rA system from the end of 2005.
Service Launch : 2H 20006
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.
Wi-Fi certified WLAN Card and MAC-based authentication
Data transmission speed : maximum 11Mbps, average 3~5Mbps within 100M from an AP
Major WLAN equipment suppliers (WLAN card, AP, and Bridge): Samsung Electronics, Acrowave, IP One (SK Telecom), Avaya Korea, 3Com, Agere Sytems Korea, Intel Korea
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
In the 4G, data can be transmitted at the speed of 100Mbps while moving and 1G while not moving.
MIC selected 4G as one the 10 new growth engines in 2003
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.
Goal, Strategy, and Timetable :
2005 Develop commercial WiBro products
Develop 100Mbps-level Wireless Transmission Test System
2007 Develop 3G Evolution prototypes
2010 Develop 4G mobile communications source technologies
By 2010, the next generation mobile communications market is expected to create 103 trillion KRW (817 million EUR) in production.
Handover among various networks is critical in order to realize 4G.
Frequency spectrum under review for 4G :
Korea & Europe 2700-5860MHz
Japan 3400-4200, 4400-4900MHz
Industry in Korea expects 4G spectrum to be allocated from 2007 and commercialized from 2010.
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.
-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
Core Parts Technology for Multimedia Human-Friendly Mobile Terminal
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.
Voice/text recognition and switch chip
Video/Visual recognition and switch chip
Bio recognition sensor
Self recharge device
Human-Friendly Mobile Terminal Parts Technology
DVD-quality MPEG4 codec
VGA CCD sensor for mobile phone
Codec for sound effect and voice processing
32bit A/D, D/A one-chip
Multimedia Mobile Terminal Parts Technology Core Parts Technology for Multimedia Human-Friendly Mobile Terminal Component Technology Core R&D Area
Has been developing both MB-OFDM and DS-CDMA chipsets since 02. 2002
Completed development and test of MB-OFDM chipset in 09.2005
Plans to make a demo for 220Mbps in 11.200
Plans to complete development of DS-CDMA chipset by the yearend
SAIT works with ETRI for MB-OFDM
Samsung is a founding member of MBOA and Wireless USB Promoter Group
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
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.
Of the 24 patents of Korea in the UWB, about 50% is patented by foreign companies.
Korea’s UWB technology falls behind compared to Japan and USA
However, Samsung is very active in standardization of UWB within the IEEE 802.15 working group
Korean government, public R&D Centers, and private companies are actively pursuing UWB technology and commercialization
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.
LG Electronics is developing MIMO jointly with Stanford University of USA.
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.
Samsung, LG, and ETRI are expected to release next generation mobile communication system design adopting OFDM and MIMO during 2H of 2006.
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.
In June 2005, Wibro 2 nd phase standards that enables 50Mbps downstream were fixed. Wibro 2 nd phase standards specify MIMO and smart antenna.
Nortel plans to release HSUPA using MIMO and OFDMA in 2007-2008.
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.
Handover is one of the main issues that hinders WCDMA in Korea.
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
KTF announced in August 2005 that it would develop, together with Agilent, a chipset supporting, specifically, Handover.
Only Voice Handover function has been commercialized. Development of Data handover technology will be completed next year.
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.
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.
(5) Single molecule and single cell control technology (KRISS)
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)
Investments in 10 mega public R&D projects between 1989-2004 :
2.7 tril KRW (2.1 bil EUR)
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
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.
Main R&D Area
(1) Radio Wave Resources
(2) Radio Environment and Electromagnetic Field (EMF) Safety Standards
(3) Technical Regulations on telecommunications, radio-communication and broadcasting.
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.
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.
Focus of PECoM is from progress management to the overall process of project planning, evaluation, and follow-up.
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
MIC is setting out a mid-to-long term operation plan for frequency use
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.
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.
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
(2) Build Spectrum policy support system
Build a Portal for Radio Wave management and policy support
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.
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.
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.
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.
KT is developing the dual-mode base station technology that supports both Wibro and WCDMA.
ETRI is developing CR and SDR technologies.
InnoWireless Co., Ltd ( www.innowireless.co.kr ) of Korea contracted a R&D project with IITA to develop SDR-based measurement equipment for Wibro.
UWB & CR
- 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
- 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.
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.
Source: Survey, National Internet Development Agency of Korea, Sept. 2004
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.
Mobile Banking Service (IC Chip-based Service) (Unit: thousand) Source: LGT, Bank of Korea,
Flat rate of 0.63EUR/month, 1.04 million subscribers
Sep. 2003 BankOn LGT
480,000 K-Bank handsets sold
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
IC-Chip-based Mobile Banking Subscribers Source: Bank of Korea, 2005
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”.
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
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.
MIDI ring tones are being replaced by MP3 tones which allow users to enjoy original sound.
The size of mobile music market in 2004 was nearly 400 million EUR.
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
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.
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).
Mobile operators introduced more than 1,500 new mobile games in 2004 and also a flat rate mobile data fee to boost the market.
More than 500 game developing companies are fiercely competing in the domestic market.
(Unit: mil EUR) Market Share Source: 2004 Korea Game White Paper Revenue and Growth Rate of Mobile Game
Multimedia (Character, Photo and Moving Image)
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.
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.
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.
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
- Mobile multimedia broadcasting service providing information on a real-time basis through cdma2000 1x color handsets
What is IT839? Goal: Home networks in 60% of households by 2007 Goal: 10 million Telematics service users by 2007 Source: MIC IT839
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
- Reduce costs for content development according to 3 different platforms of 3 operators by providing a set of common APIs (application platform interfaces).
- Allow Content Providers to focus on the substance of the contents
For Handset Vendors
- 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
- Facilitate easier conformance to carrier requirements
For Wireless Carriers
- Facilitate simplicity and speed in deploying new services
- Timely delivery of handsets
- Form environment for quality contents
- Quality contents brings more data revenue
- More quality contents
- Enjoy good contents regardless of service provider
- Ease of software upgrade
Goals of Standardization of Platform
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
Scope of Standardization
HAL API Specification : Define a common adaptation layer spec in HAL (Handset Adaptation Layer) to facilitate hardware independence of the platform
API Specification for Contents : Define a common and rich set of APIs for application developers. The platform must support C and Java language
Functional specifications : Define major functionality of the platform
- Conversion of applications to machine code - Concurrent multiple application execution
- Application program management - Support for multiple languages
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
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.
Main components of domestic camera phones show over 60% of localization.
Most camera module manufacturers succeeded in developing 5~7 megapixel products, however, their main items are still 1.3 and 2 megapixel products.
Korean companies have strong technology edge in CMOS image sensor rapidly replacing CCD.
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.
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.
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.
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;
Technology Area Dependency on foreign technology
Edge Router 91%
Stereoscopic 3D TV system 90%
Mobile phone 20~30%
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
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.
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