By Kim Yoo-chul
Staff Reporter
SK Telecom and KT, the nation's two biggest mobile carriers, plan to expand investment in WiBro services, the Korea Communications Commission (KCC) said Monday.
SK Telecom will invest a total of 300 billion won ― 140 billion won in 2010 and 160 billion won in 2011, a senior official at KCC's telecom policy bureau told The Korea Times, asking not to be identified.
"As far as WiBro services are concerned, SK Telecom will go ahead as scheduled," its CEO Jung Man-won said. SK Telecom invested 127.3 billion won last year.
In contrast, KT Corp. has increased investment budget for WiBro to 1.2 trillion won from an earlier projection of 1.1 trillion won as of the end of 2011, KT representatives said.
By 2011, KT, led by CEO Lee Suk-chae, will invest a total of 461.8 billion won for the networks.
The company, which was granted 688.2 billion won for WiBro investment by the government as of the end of 2008, invested 46 billion won for the services, according to officials.
"KT has revised up the investment target for WiBro. But the telecom regulator isn't happy about the new plan, which means KT may pour more in," a KT spokesman said.
KCC officials said WiBro services will be expanded to the Seoul-Daejeon highways from early next year due to the investment decision by the top carriers.
The upbeat investments came after the regulator clarified that it would give a "golden frequency band (800/900MHz)" to a carrier who allocates bigger budgets for WiBro.
"KCC plans to link frequency bands into WiBro to revive the investment momentum, which is rather difficult to understand," an SK Telecom representative said.
WiBro, short for "wireless broadband," is the local variant of the mobile WiMax. The technology has virtually failed to appeal to customers due to limited coverage.
The service, launched in June 2006, is only available in and around Seoul, and a few other cities on a limited basis.
When the services started a couple of years ago, the government forecast that the WiBro market would reach 8.1 trillion won in 2010, with the domestic equipment market estimated at 5.8 trillion won.
The forecast proved to be way off the mark, with SK Telecom and KT having a combined user base of less than 250,000 WiBro subscribers, according to company officials.
At a time when SK Telecom and KT are shifting their eyes for the next-generation telecommunication technology called for long-term evolution (LTE) while escaping from WiBro, the KCC recently said it will modify the current telecom laws and demand the two companies allow new operators to access their base stations while opening up their WiBro and 3G WCDMA (wide code division multiple access) network for roaming.
"When there is a market, telecom carriers will voluntarily invest," the SK Telecom representative said, adding WiBro is not attractive in terms of economies of scale.