SK Telecom sets partners for LTE launch

South Korean telecom giant SK Telecom Corp. Ltd. (SKM) said it has selected Samsung Electronics Co. Ltd., LG-Ericsson and Nokia Siemens Networks to as equipment suppliers for its LTE network. The carrier said it plans to begin providing commercial LTE services in Seoul, South Korea, beginning in July, with nationwide coverage by 2013.
Financial terms of the deployment were not released. The news follows up on its announcement earlier this month of a new strategic direction for South Korea’s largest wireless operator.
SK said it plans to use different vendors’ switching equipment and base station equipment to service one area, though Samsung and LG-Ericsson were singled out in providing switching equipment while all three companies will provide base station equipment.
In addition to traditional base stations, SK said it will update up to 500 base stations this year with a six-sector solution that it claims will double the capacity of current base stations. The carrier will also utilize up to 62,000 Wi-Fi hot spot locations to support data services and up to 10,000 femtocells.
SK said it will use its own Smart Cloud Access Network that will allow it to store digital units from base stations in one area, while the remote radio units and antennas will be set up in various locations. The carrier is also planning on using 800 MHz spectrum for the LTE service that is currently awaiting governmental approval.
In support of the launch, SK said it will initially offer wireless modems, but plans to add smart phones and tablet devices by the end of the year. The smart phones will rely initially on the carrier’s W-CDMA 3G network for voice services as well as fall back for data services when outside of LTE coverage.
Q4 results and challenges
Earlier this week, SK reported a 2% year-over-year increase in wireless revenues to $2.54 billion for the fourth quarter of 2010. The growth was boosted by strong sales of smart phones and increased wireless Internet usage, which increased 22.4% to $759 million. The carrier ended the year with 25.71 million connections on its network.
Despite the solid growth, one analysts firm predicted challenges ahead.
“Despite being the leader in the domestic wireless market, SK Telecom is facing greater challenges in retaining its market position,” noted Zacks Investment Research. “SK Telecom continues to spend heavily as the carrier is boosting its promotional efforts to contain customer churn amid stiff competition from rival KT Corp. , which is aggressively marketing Apple Inc.’s iPhone since November 2009.”