By Kim Yoo-chul, Cho Mu-hyun
KT said Thursday that it will expand investment on its fixed-line network to realize an efficient network infrastructure.
The firm’s business plan was revealed during its 17th IT CEO Forum under the theme “The Great Stagnation & Korea’s Transition” at the Renaissance Hotel in Gangnam, Seoul,
As the market wants access to the best network due to the widening use of long-term evolution (LTE), KT plans to save on costs and increase quality competitiveness by strengthening its “Fiber to the Home” fixed-line project for seamless connections everywhere by installing more local area networks (LAN) and upgrading LTE download speeds.
The mobile operator’s ultimate expansion goal is to lessen data traffic and expand its wired and wireless product portfolios.
KT is the largest fixed-line operator in Korea and is planning to use that advantage to assist its growing mobile business, the second-largest in the country, according to industry officials.
“No one can deny that KT is the largest and most powerful company among competitors when it comes to fast-speed LAN and fixed-line services. These projects can support its growing LTE business,” said one official.
The three domestic mobile carriers, KT, SK Telecom and LG Uplus have chosen different strategies to mark their respective services. SK Telecom offers free content downloads, while LG has opened up a cloud-based game platform.
The plan falls in line with George Mason University professor Tyler Cowen’s forum lecture on how the Korean economy will pull through the global recession using its growing power in Internet and cultural content businesses. Cowen was chosen as one of the most influential economists of the past decade by English weekly the Economist.
The professor met with KT Chairman Lee Suk-chae at the forum and discussed the future vision of the Korean economy and business philosophies.
According to KT, they pointed out some structural problems of the domestic economy and proposed solutions to bolster job creation in addition to finding a new business paradigm that will propel the information technology industry to become a new growth engine.
Since the completion of its nationwide LTE network earlier this year, the mobile operator has repeatedly stated that it plans to build other network equipment such as fixed-line telecommunications and WiFi to facilitate wireless connections. “We want to ensure that consumers from home to work or any other place are assured a stable connection,” said a KT executive.
“KT’s upgrade of its backbone network can impact not only its domestic telecom equipment businesses but the global competitiveness of domestic IT businesses,” said Kim Sung-man, head of KT’s network division. “We plan to cooperate with domestic manufacturers that have the technology and quality that is up to the global standard.”
Cowen also acknowledged in his speech that the proliferation of Korea’s creative industry offers significant gains to the domestic economy.
Around 300 executives from domestic information technology firms including 50 from startups attended the forum. The KT chairman also met Ofcom CEO Ed Richards Thursday on the sidelines of the conference, to discuss the future direction of telecom regulations. The two talked of the rising role of regulators as networks become increasingly important in the current era of smart devices.
“Though network-based businesses are growing rapidly, the value of telecommunications companies is declining,” said Lee. “Data traffic and revenue are disproportionate, which is weakening incentives to invest in networks.” Richards said, “The role of the regulator is becoming more and more important for the telecommunications market to develop continuously. Regulations should head towards the direction in which the interest of companies and consumers do not collide.”