Efforts for development of CDMA business in China are being intensified as SK Telecom initiates joint sourcing of handsets with China Unicom.

SK Telecom and China Unicom (CEO Chang Xiaobing, www.chinaunicom.com) revealed on the 26th that Korea and China had decided on “joint handset sourcing” in order to target the two markets of Korea and China.

This is the first time that any conspicuous achievements have been announced since the strategic alliance between SK Telecom and China Unicom.

On June 21, SK Telecom established a contract for purchase of CBs worth USD 1 billion issued by China Unicom Limited, a company listed in Hong Kong. Also, through the establishment of a “Strategic Alliance for CDMA Services” with China Unicom, SK Telecom has announced alliance and cooperation in joint handset sourcing, joint development of additional services, joint platform development, marketing / distribution, CRM, and network.

As a result, for specific implementation of the 6 areas of strategic alliance between SK Telecom and China Unicom, a consultation group and task force consisting of 50 working level members from both companies are in operation, with discussions on specific ways of cooperation through mutual provision of consulting in each area, sharing of expertise, provision of market information, etc.

On September 11, a workshop was held in Busan for two days on the 6 areas of strategic partnership with participation by the CEOs of the two companies, with an agreement to make it a priority to pursue joint handset sourcing.

Through such an agreement, SK Telecom and China Unicom has agreed to source joint handsets of 6 types in the first half of 2007 for the Korea and China markets, and plan to continue expanding the supply of model types and volume by 2008.

The 6 types of joint sourcing handset models released in the first half of 2007 are subject to discussion among the 3 handset manufacturers, Samsung, LG, and Motorola, mostly targeting the mid-to-high-end market in China, with differentiated handsets based on CDMA20001x network with applications such as high quality LCD, 2 Mega Camera, and Bluetooth.

Going forward, in order to target the high-end and low-end markets of both countries, other than the 3 handset companies, diverse handset line-ups are planned for deployment upon discussion between Korean, Chinese and foreign handset makers. Through cooperation between the two companies, joint supply of mid-to-low priced models aimed at the China and Vietnam markets are also planned.

Through the joint sourcing of handsets, SK Telecom expects the acquisition of “handset price competitiveness through an economy of scale”, along with the differentiated wireless Internet and VAS of CDMA services that target the 20 million SK Telecom subscribers and 35 million China Unicom subscribers. Moreover, it is expected that this will contribute to the expansion of CDMA services within China.
SK Telecom’s CEO Shin-Bae Kim remarked, “It is quite significant that since the strategic alliance with China Unicom, we have been able to overcome various difficulties, such as the difference in the telecommunications environment of the two countries, to acquire handset competitiveness, which is the most important. As our first achievement comes based on the devoted work of the two companies, we hope that the joint sourcing of handsets will lead to a dramatic development of China Unicom’s CDMA business and a turning point for China’s CDMA business.

China Unicom’s CEO Chang Xiaobing remarked, “The joint sourcing of handsets will be an important basis for development of CDMA operations, and we will provide full support so that the diverse strategic ties between the two companies can bear fruit.”

SK Telecom and China Unicom revealed that other than joint handset sourcing, they are undergoing discussion for achieving results in other areas of cooperation under the strategic tie-up, such as joint VAS development, joint platform development, marketing/distribution, CRM, network, etc.

The true age of global mobile communications has come, in which one mobile phone can be used for services anywhere in the world.

On September 13, SK Telecom and Samsung Electronics revealed that it would release a World Phone (model: SCH-V920) that supports CDMA, mobile communications technology used in Korea, GSM, used in Europe, and JCDMA used in Japan, making automatic roaming possible in 90 countries around the world. This is the first time in the world that a mobile phone has been released that allows automatic roaming all over the world including Japan.

“Real World Phone”, released by Samsung Electronics for SK Telecom, supports CDMA for automatic roaming in North America, Latin America and Asia where 800MHz spectrum is used as in Korea, as well as GSM with frequencies of 900, 1800MHz in Europe, CIS, Oceania, and even Japan’s JCDMA, and is a “World Phone” in the true sense.

In the past users could use their phones and numbers in North America, Latin America and Asia where the same CDMA technology is used, but now they can receive automatic roaming services in Europe and Japan, and the World Phone is expected to become an essential for businessmen who travel frequently to Japan and Europe.

Also, through the launch of World Phone, SMS messaging and receiving, and caller ID services are possible in GSM regions such as Europe. SK Telecom has revealed that a free demonstration event will be held until the end of October for outgoing SMS messages, which are KRW 460 per message (SMS reception and caller ID services currently free.)

Despite the fact that it is a phone that supports various mobile communications technology, it has adopted the currently popular slim slide style, and it is hoped that its functional attractiveness along with sophisticated design will be favorably received by consumers.

An “Anycall Translator” function has also been included, allowing translation of simple expressions in various situations into English, Japanese and Chinese in airports, hotels and stores. The phone also has functions most preferred by consumers, including a 1.3 million pixel camera, Nate Drive, MP3, and Bluetooth functions.

To celebrate the launch of World Phone, SK Telecom and Samsung Electronics will hold a “Two-Top Real World Phone Festival” from September 20 to October 31. Customers that purchase World Phone during the period are automatically entered, and among the winners 10 will receive airline tickets for a world tour, 20 the opportunity to visit Tokyo and Yokohama, a total of 100 receiving diverse prizes.

SK Telecom’s CEO Kim Shin-Bae remarked, “Among total departures, those leaving for Japan take up 20%, and thus it is highly significant to become the first in the world to release a World Phone that can cover Japan.”

Samsung Electronics Head of Information and Communications Lee Ki-Tae remarked “Samsung’s mobile phone with hi-tech functions and quality design will be a route through which people can communicate freely and conveniently anywhere in the world.”

“Real World Phones” are to be released through SK Telecom in four colors – “deep grey”, “double red”, “shiny silver”, “white” – and cost approximately KRW 500,000.

SK Telecom launches WCDMA automatic roaming services with England’s T-Mobile, Netherland and Sweden’s Vodafone, Denmark’s Hi3G in England, the Netherlands, Sweden and Denmark.

Automatic roaming services allow the user to take his/her mobile phone overseas for usage without changing handsets or being designated a separate number. WCDMA automatic roaming services even allow video calling (video calling not available in Denmark).

With four European countries added, WCDMA roaming services may be used in a total of 12 countries, including countries where previously available, such as Italy, France, Germany and Spain. SK Telecom has built a foundation for deployment of a WCDMA roaming belt in the European region, from Sweden in the North to Spain and Italy in the South.

SK Telecom revealed that it will continue to expand WCDMA automatic roaming services in the Europe region, in countries such as Portugal, Finland and Austria, and in Asia in countries such as Malaysia, Brunei, and the Philippines.

Lee Sung-Young, head of SK Telecom’s Global Roaming Division, remarked, “The availability of WCDMA roaming in the Western European region, where a great deal of foreign travel demand is concentrated, will contribute to the promotion of WCDMA.”