SEOUL, South Korea-SK Telecom said it received approval from the Ministry of Information and Communication to merge SK Telecom and SK IMT, the W-CDMA arm of the Korean mobile operator. However, under the conditions for the merger approval, SK Telecom must provide W-CDMA-based service in the 2 GHz band with backward compatibility by end-2003.
MIC said SK Telecom’s W-CDMA service rollout plan and equipment procurement plan should also be submitted for approval. SK Telecom must also receive approval for its initial tariff plan for the services and must provide network interconnection to other telecommunication operators.
The announcement confirms SK Telecom’s commitment to W-CDMA, which has been in question. Both SK Telecom and the country’ second-largest mobile operator KTF offer 1x EV-DO services, a 3G evolutionary technology for CDMA networks, the second-generation standard in Korea. However, SK Telecom and KTF hold W-CDMA licenses as well, which could set up one of the world’s only markets with operators offering dual 3G technologies.
But SK Telecom and KTF have been slow to roll out W-CDMA networks due to the high costs of buildouts and little necessity because of the EV-DO offerings already in place. Although the Korean government has encouraged the carriers to move forward with W-CDMA buildout plans, investors and industry watchers have questioned the business case for having dual-technology 3G networks.
There was even a suggestion by a KTF executive earlier this year for cooperation between the two operators on their W-CDMA rollouts.
“Our-W-CDMA investment strategy places foremost priority on economics, considering the development and availability of handsets and equipment, which guarantee marketability and quality of the service,” said SK Telecom in a statement. “The initial W-CDMA service will be provided in areas in which high demand is expected and will be expanded in a gradual manner.”
