By Kim Tong-hyung
KT, the country's biggest telephone company, has all but outright declared that the traditional public switched telephone network (PSTN) has decayed as a business model.
The company will replace all of its landline office phones with mobile and voice over Internet protocol (VoIP) devices when it opens its new southern Seoul office in February.
Since absorbing its mobile unit, KTF, earlier this year, KT has been putting strong emphasis on wireless services, Internet telephony and next-generation services such as Internet protocol television (IPTV).
However, fixed-line telephony, which had been the company's bread and butter for nearly three decades, has been somewhat neglected.
KT's Seocho-dong office in southern Seoul will effectively work as the company's new headquarters, with the company's wireless, household and media business divisions being relocated to the new building.
The presence of landline phones will also be reduced in KT's existing Gwanghwamun office where its corporate clients division will remain.
The company recently dished out "smart" phones, which support Internet functions such as Web browsing and e-mail atop of voice, to the 350 members of its corporate business unit.
A "mobile office" system was also built to allow the employees to use handheld devices for office work and electronic payment.
KT currently controls more than 90 percent of the country's fixed-line telephony market, but has been losing customers to mobile and cheaper Internet telephony services.
The company once had more than 22 million fixed-line telephony customers and had 21 million at the end of 2007, but the number is now around 18.5 million and is continuing to slide.
KT paid the price for being slow out of the gate in Internet telephony, as there were concerns about cannibalizing its own customer pool.
However, the company is now aggressively integrating VoIP into its business strategies, evident in its full backing of a new Internet telephony service called fixed-mobile convergence (FMC).
FMC allows users to switch between fixed-lines and mobile networks using a single handset. Fixed-mobile telephony customers could use Wi-Fi-enabled mobile phones to access fixed-line networks when making calls at home or in the office, while accessing wireless networks on the move.
This clearly benefits users, as VoIP charges significantly less for voice minutes than conventional wireless services.
KT expects significant demand for fixed-mobile telephony from business users, such as start-ups looking to reduce telecommunications expenses.
The company intends to test its FMC services on its employees first at its landline-free Seocho-dong office. The employees there will be given FMC-enabled phones that will be equipped with a wealth of office functions, including call forwarding and voice interconnection between colleagues.
"FMC services will find significant demand from both business and individual clients, and by establishing and testing new FMC solutions at KT's own office, we will be able to stay ahead in terms of innovation," a KT spokesman said.