KT eyes acquiring D'Live, CMB

By Kim Hyun-bin

KT is planning to further solidify its lead in the pay TV sector by reviewing the possible acquisitions of D'Live and CMB, just days after it inked a deal to purchase Hyundai HCN.

“D'Live and CMB are in the same field as Hyundai HCN,” Kang Kook-hyun, head of KT's customer business group, said during a press conference in Seoul, Wednesday. “If those companies could create synergy and growth with KT, they will be under review for acquisition.”

KT CEO Koo Hyun-mo also hinted that “we will be able seal additional deals next year.”

At the end of last year, Hyundai HCN held a 4 percent market share in the sector. KT's acquisition of the company will boost its share to 35.5 percent ― a solid lead over competitors LG HelloVision (24.9 percent) and SK Broadband (15.2 percent).

During the conference, Koo emphasized KT's goal to transition into a digital platform company.

“Currently, 40 percent of KT's total sales come from the non-telecom sector,” he said. “We have been conducting a digital transition and through it our goal is to find future growth engines.”

The non-telecom sector includes business-to-business (B2B), energy and media. In the B2B sector, the three main pillars are artificial intelligence (AI), big data and cloud computing, where KT is hoping to generate up to 2.5 trillion won in sales this year.

KT invested over 2 trillion won in its cloud business over the past decade and is scheduled to open an internet data center (IDC) in central Seoul next month.

The company is developing an AI call center that is expected to be implemented in diverse industries and companies to help their digital transformation.

“The business will create around 3 to 4 trillion won in sales,” Koo said. “We plan to launch the platform business next year.”

KT's media sector's compound annual growth rate over the past five years was an average 20 percent, while IT posted 18 percent. Even the AI and digital transformation sector rose 8 percent in the period.

Annual sales in the media businesses started at 700 billion won in 2014, but skyrocketed to 1.6 trillion won last year. This year the figure is expected to hit 1.8 trillion won.

Once KT Skylife gets the green light and fully acquires Hyundai HCN, annual sales in the sector are predicted to be 2.8 trillion won.

“The company's network infrastructure backs KT's strategy to become a digital platform business and to increase our B2B market share,” Koo said. “We have experience and capability to combine AI, big data and cloud technologies to specific industries to create business value.”