HONG KONG-“Third-generation services are here,” proclaimed the advertisements from Qualcomm at International Telecommunication Union (ITU) Telecom Asia 2000. “The wait is over.” Korea’s SK Telecom was the first operator to deploy
cdma2000, noted Terry Yen, Asia Pacific director of the CDMA Development Group. SK Telecom is delivering 114 kilobits per second (kbps) now and will deliver 144 kbps in the near future.
This is the CDG interpretation of 3G, a perception widely held in the United States, essentially referring to increased data rates. The broader issues of global availability of services, ITU definitions and standards, and economies of scale are conveniently omitted.
Yen said the introduction of subscriber identity module (SIM) card-enabled CDMA handsets now enables plastic roaming between GSM and the cdmaOne networks in Australia, Japan, Korea, Thailand and the United States. And global roaming can easily be accommodated with future handsets, asserted Irwin Jacobs, Qualcomm chairman, pointing out Qualcomm has developed chips supporting multimode, multiband and multinetwork operation.
But SK Telecom seems disinclined to wait. It wants to deploy wideband-CDMA (W-CDMA) technology. So do its competitors.
After merging with Shinsegi Telecom last year, SK Telecom has the unusual problem of having to reduce its market share by 7 percent to meet Korea’s antitrust legislation. Rival KT Freetel is in the process of swallowing up KT M.com (formerly Hansol M.com), leaving Korea with just three cellular operators: SK Telecom, KT Freetel and LG Telecom. All operators deploy cdmaOne networks, making Korea the only pure-play CDMA country in the world. The nearly 30 million subscribers in Korea represent more than 40 percent of CDMA’s global subscriber base and more than 90 percent of CDMA subscribers in the Asia-Pacific region.
Both SK Telecom and KT Freetel have implemented the
cdma2000 air interface. But they have both implemented it on existing spectrum, rather than the third-generation (3G) spectrum bands identified by last year’s ITU World Radiocommunication Conference (WRC-2000).
Three 3G licenses are on offer in Korea. All three incumbent operators submitted bids to deploy W-CDMA rather than cdma2000 networks. Roaming is cited as the main reason for abandoning the cdma2000 route, although royalty payments are believed to be a significant contributing factor. The Ministry of Information and Communications is not happy, having requested at least one operator implement cdma2000 to support Korean industry-notably Samsung, Hyundai and LG Information & Communication (LGIC). Korea has been committed to CDMA technology through the government’s attempt to back a winning technology a decade ago.
The ministry’s dilemma was compounded by a late bid to build a cdma2000 network from fixed-network operator Hanaro Telecom. With a large debt burden and no mobile experience, Hanaro is hardly a perfect candidate to deny an incumbent a 3G license.
But in late December, the ministry awarded W-CDMA licenses to SK Telecom and KT Freetel. The LG Telecom and Hanaro Telecom bids were rejected. However, the government has offered both companies unspecified incentives to rebid in March on the condition they commit to a cdma2000 network. Hanaro intends to rebid. LG Telecom has stated it will not reapply and is threatening legal action against the government, as the rejection of its bid has put the whole LG Group into crisis.
