Seoul, Korea, 25 October 2010 - SK Telecom (NYSE: SKM)'s President and CEO Jung Man-Won held a press conference today at its research lab in Seoul National University to announce the opening of Open Innovation Center (OIC) and the company's growth strategy to become a global platform provider. Jung also uncovered seven platform areas to focus on and four strategic directions so as to turn service platform into one of the core businesses of the company.
Jung Man-Won, President and CEO of SK Telecom said, "SK Telecom plans to invest KRW 1Trillion over 3 years on service platforms business. The company will also pursue global platform business in U.S., China and Southeast Asia markets."
The CEO defined service platform as a means to deliver content, service and application such as Facebook, Google Maps, and Apple's iTunes to the customers (handsets).
Jung said, "For instance, it is application if its function is limited to showing maps and playing music, but it is service platform if it has scalability that allows the participation of outside developers. SK Telecom plans to transform its T Map, T Store and text messaging service into service platforms."
Moreover, the company, recognizing the importance of openness in creating a successful and expanded ecosystem for service platform business, plans to disclose the base technologies of its competitive services to shape them into global service platforms.
SK Telecom held the opening ceremony of OIC today and said that it completed the establishment of the collaborative innovation center, which can, in cooperation with the existing T Academy and MD Test Center, provide comprehensive services to support application start-ups.
Outside developers with brilliant ideas can receive professional training at T Academy and develop a competitive business model at OIC. Then MD Test Center provides various mobile devices on which developers can test the compatibility of programs and applications. Then at last, they can start a business with the support from OIC in funding, office space, business administration and marketing.
Jung said, "The opening of OIC enables SK Telecom to provide a total support system for outside developers. SK Telecom now has completed building an ecosystem that can foster a group of developers, the most critical element to accomplish the service platform strategy, and realize shared growth."
◆ Background for Promoting Platform Business
Considering its technological capability and the massive potential of the platform business, SK Telecom is set to seize opportunity in the global market, which is usually dominated by a few successful competitors. This will also serve as a chance for the company to move away from the current subsidy-oriented marketing competition.
◆ Selecting Seven Service Platform Areas
SK Telecom chose seven service platform areas among its current service offerings and will make extensive efforts to develop them into its core business. Furthermore, it plans to add new areas of service platform taking into account the changes in the market.
The seven service platform areas the company will focus on nurturing are as follows: ▲LBS (T Map)▲Commerce (M-Payment) ▲Messaging (SMS, NateOn) ▲Contents Distribution (MelOn, T Store, TV Portal, Personal Media) ▲SNS (Cyworld) ▲B2B (Connected Health/Car/Education, Smart Office etc.)▲Platform (Mobile Advertising, Personalization Engine, Wireless Personal Area Network, etc.)
※ Personal Media(PM): Media content business based on N-screen technology
WPAN(Wireless Personal Area Network): A personal area network
◆ Presenting Four Strategic Directions for Business
SK Telecom put forth four strategic directions that will lead the company to success in the platform business. They include ▲securing scalability to enable development of various services, ▲internalizing core resources and capabilities, ▲promoting openness to expand the ecosystem, and ▲pursuing glocalization by cooperating with main local players.
◆ Promoting Shared Growth by Joining Hands with Outside Developers
SK Telecom also announced plans to create a cooperative ecosystem to realize shared growth with content providers, device manufacturers and outside developers.
The company will open its competitive platforms like T Map, T Store and SMS/MMS to outside developers. To this end, it plans to start operating Integrated the Application Programming Interface (API) Center within this year. Moreover, all platforms to be developed in the future will be designed and built based on the premise of openness, thereby enabling outside developers to create a wider variety of applications.
For example, developers can create programs that not only enable customers to get necessary information and coupons when they search for a nearby restaurant by accessing T map through their smartphones while walking on the street, but also allow restaurant owners to place the advertisement of their stores into the electronic map.
From today, SK Telecom starts operating a project to support one-person start-ups. It selects a would-be entrepreneur with creative idea or technology and offers a comprehensive service to help him/her set up the company, including the start-up capital of up to KRW 50 million, office space accommodating 1~5 persons, managerial support regarding tax/accounting/law, test devices and technical assistance, participation in T Academy training and on/off line marketing support through T Store and Nate, etc.
In addition, the company will seek shared growth with other companies that wish to develop business items based on its open service platforms. It plans to provide incentives as well as funding of up to KRW 50 million, after evaluation, to a company that proposes business linked to its platform.
Jung said, "SK Telecom has developed over 5 million content applications since it opened Nate, a wired and wireless Internet service, in 2001. Yet due to the lack of scalability, they could not be expanded in the domestic market, let alone the global arena. Nonetheless, SK Telecom is highly likely to succeed in service platform business thanks to its strength in content development and the newly upgraded ecosystem. What it needs now is to develop more and more platforms at a quicker pace while opening their API so as to enable outside developers to easily create more applications."
