SK Telecom 1 U U U U U U U- U - - communication - - - - PowerPoint PPT Presentation

U U U U U U U- U - - communication - - - - - communication communication communication communication communication communication communication Korea Mobile Market Trend for Convergence & Ubiquitous Communication 2004. 03. 04. SK Telecom 1

U U U U U U U- U - - communication - - - - - communication communication communication communication communication communication communication Table of Contents I . Mobile Market Situation I . Mobile Market Situation Subscribers & ARPU Market Growth Factors Technology Evolution Global Competitiveness I I . Market Driven Factors I I . Market Driven Factors I I I . Market Paradigm Shift I I I . Market Paradigm Shift 2

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication I. Mobile Market Situation Subscribers & ARPU Mobile Market Shares In Korea Wireless & Wired Penetration Rate Expectations 80% 40 71% 33.6mn 30.5mn Mobile 35 60% 20mn 30 Total Sub. Total Sub. Total Sub. Total Sub. 48% Wireless sub surpassing 25 wired line's (Sep 99) Fixed Line 40% 20 10mn 15 Wireless subscription 5mn 10 20% surpassing wiredline's (Sep 99) 5 5 mobile operators to 3 players 0 0% 97 98 99 00 01 03E 04E 05E 02 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 Major Asia Nations Penetration Rate 1. SK Telecom ! Subscribers : 18.3 Millions ! Taiwan : 90.6 % ! Hong Kong : 83.1 % ! ARPU : U$38 (Data $6 included) ! Singapore : 71.6 % ! Japan : 50.1 % 2. Other Players * Source : Global Mobile (Year 2001) Subscribers : 15.2 Millions ARPU : U$32 ! Korea Wireless Market : 71 % (Yr. 2003) 3

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication I. Mobile Market Situation Market Growth Factors 6 Data 5 4 3 Voice 2 1 0 1999 2001 2003 2005 2007 2009 Data Market Growth (Source : SKT Data) Global Telecommunication Unification (Current Data APPU Ratio : 15% vs. Yr.2002 : 10% ) - Global Roaming : CDMA 13 nations, - GSM-CDMA Inter Standard Roaming 44 nations (Source : SKT Data Yr. 2003) Data Voice Video Video Multiservice I nternet Network Paradigm Shift of Technology & I ndustry Data Service Expansion (Multimedia etc.) (Company & Company " Industry Integration) (Current Throughput : Avg. 600kbps) 4

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication I. Mobile Market Situation Technology Evolution 4G 4G 4G 4G 1995 1995 2000 2000 2005 2005 2010 2010 1995 1995 2000 2000 2005 2005 2010 2010 High Very High Speed Multimedia Service 3.5G High Speed IMT- 2000 Wireless 3G Improvement UWB IMT- 2000 Service 2G/2.5G Portability 2-11 GHz W-Broadband Cellular/PCS B-WLL, 802.16 Mobile Access 5 GHz WLL W-LAN 2.4 GHz 802.11b/a/g Fixed/ W-LAN Local Area Low Wireless Access Transmission Speed Low High (I mage/ Graphic) (Voice) (Data) (Moving Picture/ (High Quality Video Streaming Digital TV) / Multimedia) 5

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication I. Mobile Market Situation Global Competitiveness Total Telecom. Market Volume (Yr. ’01) Mobile Market Sales Revenue (Yr.’01) # Accounting for U$18 Billion # The 9 th ranks among OECD 24 nations 302.8 69 68.9 (Unit: U$ Bil.) (Unit: U$ Bil.) 118 66.2 11.9 10.8 66.2 18 3.2 10.3 13.4 OECD OECD USA Korea USA Japan U.K Aus. Japan U.K Aus. Korea Avg. Avg. Wired/Mobile Subscribers in 100 People Basis ( Yr ’02) Internet Users (Yr. ’02) # 100 Unit Subscribers of the Population : - Wired Line-the 21st ranks, (Unit: Mil.) - Mobile-the 18th ranks 155 129 129 130 114 118 117 85 74 68 64 62 49 57 L 24 26 16 8 M OECD OECD USA Korea USA Japan UK Aus. Japan UK Aus. Korea Avg. Avg 6

U U U U U U U- U - - communication - - - - - communication communication communication communication communication communication communication Table of Contents I . Mobile Market Situation I . Mobile Market Situation I I . Market Driven Factors I I . Market Driven Factors Customer Segmentation Segmentation Brands Power Wireless Data Market Growth I I I . Market Paradigm Shift I I I . Market Paradigm Shift 7

U U U- U U U U U - - - communication - - - - communication communication communication communication communication communication communication II. Market Driven Factors Customer Segmentation • Overall High Usage / Weekday Pattern • Worker Weekday Pattern Saturday Daylight Pattern • Overall Medium Usage • High Proportional Usage in High Rate • Weekday Worker Pattern • Work_Driven Weekday Pattern • High International Usage • Daylight Activity Saturday Pattern • Night_Life Saturday Pattern • High Mobility / High Sphere • Overall Low Usage • High Usage in High Rate Period • High Proportional Usage in High Rate • Medium WAP Usage/ High Voice Mail/VAS Utilization • Low Mobility • High Proportional Low Call Usage • Small Sphere • Short Call Segment 3 Segment 1 • Low Proportional Mobile Call • Low SMS Usage • Low WAP Minutes Mobile Biz. Person Segment 2 Non-Mobile • Weekday Intra_week Pattern • Age (40’s & 50’s) • Saturday Night-life Pattern Medium • Sunday Night-life Pattern Old • Overall High Usage Usage • Weekday Night Life Pattern • High Proportional Usage in Generation (No worker Pattern) Segment 6 Low Rate • Saturday Daylight Activity Pattern • High Proportional 011 Call • Overall Medium Usage • High Proportional Mobile Call • Low Mobility / Small Sphere Segment 4 Work & Family Usage • High Concentration in Numbers • Very Long Call • High Proportional WAP Minutes • Medium Sphere • Low Percentage of Using VAS Segment 5 • High Area Concentration College/ • Low Call Forwarding Utilization • Medium Mobility • Low Call Waiting Utilization Trainee • High WAP/SMS Usage • Age (Late 20s and 30s) • High Voice Mail Utilization Happy Hour Segment 8 • Age (10’s & Early 20’s) Segment 7 Segment 9 Pleasure Phone • Overall Very Low Usage New • Overall Very High CV Eventual Phone Generation • Very High Concentration • Very Similar to Segment 4 • Very Low Mobility Except • Weekend Pattern • Weekday(75%), Weekend(25%) • Weekend Intra_week Pattern • Longest Call • Weekday : 9 to 5 Working Pattern • Saturday Night Activity Pattern • Age (10’s & Early 20’s) • Saturday Daylight Activity Pattern • Overall Medium Usage/ Medium Call • Overall Medium Usage • High Proportional Usage in Medium Rate • High Proportional Usage in High Rate • High Proportional WAP Minutes • Medium WAP Usage • Low Sphere / Low Mobility 8 • Medium SMS Usage • Low Usage of Call Forwarding

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication II. Market Driven Factors Segmentation Brands Power Segment Brands & Target Marketing Since 1999 Segment Brand Performance Segment Brands I ntroduction Segment Brand Performance Segment Brands I ntroduction Young Target Segment M/ S I ndex ‘99 ‘99 SKT (July) 79.0% LGT (Feb.) 52.7% 51.6% 57.6% 51.6% ‘00 ‘00 KTF (May) 48.4% 47.3% 48.4% 42.4% 21.0% LGT (July) SKT (Aug.) ‘01 ‘01 KTF (Aug.) SKT (Oct.) Early ‘02 End of ‘02 Feb. 99 Early ‘00 Early ‘01 KTF (Oct.) KTF SKT ‘02 SKT (Aug) ‘02 $ $ $ $ Young Generation Subscribers’ – During 4 yrs. 10 of Segment Brands were Demand & Satisfaction launched in Korea mobile market 9

U U U U U U U U- - communication - - - - - - communication communication communication communication communication communication communication II. Market Driven Factors Wireless Data Market Growth  Newly Emerging Wireless Data Market I n Korea : New Demands? : Data 3 1 Seamless SVC Demand I ncrease (Ubiquitous Environment) Data Drive Telecommunication Service # Continuous Demanding Unlimited Communication & # Moving From Voice To Data I nformation Needs Total Domestic Total Domestic Market Size Market Size Any Any Any U$21 Billion U$34 Billion Device Place Time 100% 13% Fixed One Market, One Platform 21% 2% data Mobile 7% High Mobility, High Bandwidth Upscale Service Needs data 39% 2 Fixed Biz Convergence as a Driving Force I n The Market 30% voice # Telecom.,Broadcasting, Finance, and Sales Channel are being reformed and closely I ntegrated as a new value chain Broadcasting Mobile 46% 42% I ntra- voice I ntra-I CT Communication Telecom. Sales 0% Finance 2000 2005 Channel Cross-I ndustry 10

U U U U U U U- U - - communication - - - - - communication communication communication communication communication communication communication Table of Contents I . Mobile Market Situation I . Mobile Market Situation I I . Market Driven Factors I I . Market Driven Factors I I I . Market Paradigm Shift I I I . Market Paradigm Shift Value Driven Structure Various Service Demands High Speed & Multifunction Convergence & Ubiquitous New Driven Future Market 11