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This overview delves into the transformation of the telecommunications sector in Korea, examining the shift from traditional PSTN and leased lines to innovative broadband and mobile services. The 1990s marked a golden age for telecom, yet by the early 2000s, competition, commoditization, and market saturation began challenging established revenue streams. With growing consumer expectations and the advent of IP technology, telecom providers are compelled to evolve from mere access services to comprehensive application solutions, paving the way for a new era of value-added services and enhanced customer experiences.
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Beyond Broadband Business Sanghoon Lee KT
Telecom Business So Far • 1990s: Golden age • After 2000: • Downfall of Main Revenue Stream • (PSTN & leased line biz) • Symptoms • Competition • Commoditization of bandwidth & connectivity • IP technology • Moore’s law outpacing demand • Stock market collapse
Broadband take-up over first 10 years is faster than previous services across the OECD countries. Cellular Subscribers (1985-1995) Broadband Subscribers (1997-2003) Narrow-band Internet Subscribers (1992-2001) ISDN Subscribers (1989-1999) Broadband & Wireless/Mobile as a Rescue • Mobile/wireless market goes over the fixed communication market Mobile, CAGR 13% 1800 2.5 / 3G 1500 No of Subscriptions (million) Fixed, CAGR 1% (POTS/ISDN) 1200 900 Fixed Broadband CAGR 44% 600 300 0 2000 2001 2002 2003 2004 2005 2006 2007
Two Sides of Broadband InternetBusiness in Korea & Threat Opportunity • Revenue: Saturating market with flat rate • Expenditure: Increasing CAPEX/OPEX due to doubling traffic • High customer expectation level • Has established - high quality infrastructure - Large customer base • Opportunities in application • & value-added services (Unit : Thousand) (Unit : Thousand)
Beyond Broadband Business • From simple Internet access to “quality life/work services” • From network service to application services Yesterday Today Tomorrow Rich Contents Any-Access Web Pages Browsers Wireline HTTP HTTP FTP … RTP VoIP WAP RTSP Servers P2P,Game Wireless Simple Internet Access Quality Life/work services
Two Basic Questions for Telcos • Will |A| >> |B|? • Will Telcos dominate the market? A B
Beyond Broadband Business: Features • Different business • From access service to end-to-end service • Both best-effort & quality service • From network service to solution/application services • Applications: from niche market to mass revenue market • Different focus Ubiquity Convergence Beyond broadband business Quality Handy Bandwidth Current broadband “access” business Personalization
Existing and newly emerging services The Next Generation Network • The following picture has been in place for more than 10 years Single/simple/cost-effective network infrastructure for existing & new services Too costly, per-service network architecture Services Network control (QoS, Security, IP Mobility) Multi-Service IP Backbone Mobile Networks Data/IP Networks CATV PSTN/ISDN WirelessAccess WirelineAccess Access Transport & Switching Networks
NGN: From Vision to Reality • BcN Initiative in Korea high-quality broadband multimedia services integrating telecom, broadcasting, and Internet seamlessly at anywhere, anytime, and using any devices