Posted : 2014-01-26 16:30
Updated : 2014-01-26 16:30

KT, Samsung join for LTE

New KT CEO vows to diversify overseas portfolios

By Kim Yoo-chul

KT said Sunday it has agreed with Samsung Electronics to launch a joint promotional campaign to expand the sale of LTE-embedded devices and solutions, globally.

"KT has jointly completed the development of LTE evolved multimedia broadcast and multicast service (LTE eMBMS) with Samsung. The service will be available from Jan. 27," KT spokesman Lee Jeong-ho said.

"The two companies also agreed to level up corporate ties in business areas they are mutually interested in."

A Samsung spokesman confirmed this, saying the firm will offer advanced LTE-embedded devices to local and global customers. He added the firm's renewed collaboration with KT will help the world's biggest smartphone manufacturer expand its territory beyond manufacturing.

KT said the LTE eMBMS technology significantly enhances the quality of video-viewing in crowded areas such as movie theaters and concert halls.

"Thanks to the development of the advanced networks, our customers can enjoy faster viewing without cuts and delays even amid heavy data traffic," said Lee of KT.

Lee said Samsung's move to grow its mobile IPTV business based on the LTE eMBMS tech will be a boon for KT.

The deal between KT and Samsung comes after Hwang Chang-gyu, a former Samsung Electronics president, was named KT's new CEO. Hwang will officially start his tenure after being approved at a shareholders' meeting on Jan. 27.

"Many challenging tasks face our new chairman. What he should do is improve corporate earnings and find new business areas amid stalled corporate growth. The tie-up with Samsung Electronics is crucial. The new CEO will actively use his personal networks inside Samsung," said a KT executive by telephone.

KT was privatized in 2002 and bought its affiliate KTF. As of the end of last year, it has 54 affiliates and created 23.8 trillion won in revenue with some 60,000 employees.

But its financial state has been worsening as its former CEO Lee Suk-chae focused on expanding non-telecom businesses, according to KT officials.

Local brokerages expect KT to report 119 billion won in operating profit, while the net profit during the last three months of 2013 is expected to be 56.4 billion won, down 61 percent and 58.6 percent respectively from the previous quarter.

The two companies saw a rapid deterioration in their ties a few years ago after KT's decision to introduce Apple's iPhone in Korea in late 2009 annoyed Samsung Electronics, resulting in KT getting a "lax technology support for handsets" from Samsung, while its rival SK Telecom got favorable support.

The former KT chairman then said "Our SHOW Omnia mobile phone was an illegitimate son who can't call his father, father," and accused Samsung of under promoting the handset that only saw domestic sales of 40,000 compared to SK Telecom's T-Omnia II's 470,000.

SHOW Omnia is the only Omnia handset that features 3G WCDMA, Wi-Fi and WiBro connectivity.

"That was the past. KT will actively cooperate with Samsung Electronics in various business fields from content to hardware," said the KT executive.

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