Korean carrier SK Telecom, a pioneer in WiBro, plans to invest US$100 million for a 25 percent stake in Malaysian WiMax operator Packet One Networks (Malaysia), reports Unstrung. If everything goes as planned, SK will emerge as P1’s second-largest shareholder, after its owner, Green Packet.
SK Telecom also aims to expand its services to online music stores as well as fixed-line and wireless operators. The carrier will leverage its experience of operating “MelOn”, its own online music store in Korea, where users “rent” tracks on a monthly basis for use on various terminals. MelOn users pay a 5000 won (US$4.50) monthly to stream music to a PC or download tracks to their phone.
SK’s subsidiary, SK Communications, also runs Cyworld, one of the most popular blogging services in South Korea and NateOn, one of the most popular instant messengers.
P1 has signed up more than 175,000 business and residential WiMAX subscribers since its launch in late 2008, and recently announced a network expansion plan for reach 65 percent of Malaysians by 2012, from 45 percent this year.
SK Telecom, a South Korean cellular operator, with 50% market share, has always been lukewarm about WiMax, begging the question what SK’s plans are. Both SK Telecom and KT, the nation’s two biggest mobile carriers, plan to expand investment in WiBro services, the Korea Communications Commission (KCC) said in February.
SK Telecom says it is attracted by the growth potential in Malaysia, a country of about 30 million people where mobile penetration is high (above 100 percent) but broadband penetration currently stands at about 33 percent, according to Unstrung (See Telekom Malaysia Faces WiMax Challenge).
Korea Telecom currently offers Mobile WiMAX (WiBro) for $22 a month with 30GB data usage. Coverage for their “4G” WiMAX service includes Seoul, Incheon, Gyeonggi-do.
KT has aggressively pushed WiBro service in South Korea, attracting some 150,000 subscribers by the middle of 2008. However, the Korean government originally allowed only data service through WiBro – not voice – limiting the potential market. Cellular provider SK Telecom also has WiBro licenses but has been less enthusiastic since it is also a cellular carrier. KT is the dominant wireline carrier.
KT is the 2nd largest wireless carrier in South Korea with nearly 14 millions subs, with SK Telecom the largest. South Korea will have a total of 55.3 million mobile subscribers in 2013 with market share of SK Telecom increasing to 50.6%, estimates Research and Markets
SK Telecom was the first to launch an HSPA+ service in South Korea and plans to support Long Term Evolution (LTE), although it also runs a separate network based on WiBro technology.
In other news, Clearwire officially launched service in Kansas City, Kan., and Washington, D.C., and expanded service in Baltimore. The WiMAX operator is offering an online-only mobile Internet promotion with plans starting at $15 per month for two months after a $50 service credit in all three markets.
CEO Bill Morrow said the company plans to cover 120 million potential customers by the end of this year and plans to turn on service in St. Louis, Mo., Salt Lake City, Utah, and Nashville, Tenn., yet this summer.
Although it has not said it plans to make the switch until at least 2012, Susan Johnston, Clearwire spokeswoman, said that a move from WiMAX to LTE would not require additional towers, nor would it require a change to the company’s core networks, wide-area network or backhaul.
Russian’s Yota recently pulled the plug on WiMAX and is going LTE.
But mobile operators have traditionally shown little interest in vertical applications. Building a dedicated wireless broadband network may make sense for energy, security, education and transportation markets, says Monica Paolini.
LTE is not a backhaul solution. WiMAX is. It can be applied to both last mile or backhaul solutions, can use both licensed and unlicensed spectrum, has cross-platform gear from dozens of vendors and has an upwardly compatible transition in place for 100 Mbps mobile connectivity.
The cellular oligarchy can’t change basic economics for verticals. All they can do is squeeze them out of spectrum.
