SEOUL, KOREA - KT has suggested a blueprint in order to comply with and promote the new government's major policy, "creative economy."
Lee Suk-chae, chairman and CEO of telecommunications giant KT, said that by 2017 the company would invest 3 trillion won towards revolutionizing their network in a strategy to offer creative contents and services that run on faster networks.
Meeting with the press on June 11 to mark the fourth anniversary of its merger with KTF, the chairman said, "By making such a substantial investment, we will create 25,000 jobs in the information, communication and technology (ICT) sector for individuals."
Noting that KT cannot survive merely by adhering to its conventional business models, Lee said, "The nation’s dominant fixed-line operator plans to invest 2.5 trillion won in backbone networks and the remaining 500 billion won will be allocated for speeding up networks for households."
He said that the plan is based on an assessment that traffic on the existing high-speed Internet networks is already crowded.
Commenting that KT can save up to 2.3 trillion won by creating these new networks, he said, “Our company aims to become more than simply a telecommunications company. We aspire to create new content-oriented systems by using faster networks. By utilizing these system, we also should be able to produce services that have never previously existed.”
The chairman commented that KT is currently forced to purchase equipment that is outsourced U.S.-based network equipment giants Cisco and Juniper In an attempt to reduce this reliance on American companies, KT plans to build up networks that are standardized and commoditized. It plans to secure funds by selling some company-owned assets.
Stressing that KT is now an active and serious challenger in the changing telecommunications industry, Lee said, "The company is diversifying its business portfolios into non-telecom business sectors such as mobile, finance, media, and car-rentals."
KT is also working towards fine-tuning its Internet TV business. Confirming that KT is actively planning to introduce a new set-top box based around new technologies, he said that KT would introduce Web-based IPTV services that run on open-based software.
“IPTV will evolve as a two-way communication tool. Third party developers can create contents and participate in related projects,” said Lee. In terms of KT’s future advancement into overseas markets, Chairman Lee said the firm would expand its overseas businesses to Africa, Southeast Asia, and South America in an ongoing attempt find new cash generators.
"In particular, our plan to make inroads into Africa has reached a detailed stage. For instance, KT recently agreed to establish the joint venture LTE Infraco in Rwanda. Under the agreement, KT will help the African nation build long-term evolution (LTE) networks over the next few decades," he explained. KT plans to invest 150 billion won of the total investment of 270 billion won towards the Rwanda deal, he said. Beginning in 2014, Rwanda plans to build LTE networks across the country over the course of 25 years.
“This is a small but meaningful step. KT will export our products to Africa, South America, and Southeast Asia through various measures including the further establishment of joint ventures,” said the CEO.
Meanwhile, he stated that KT is the only Korean firm that can directly compete with chaebol, saying, "I have no interest in controlling KT affiliates, as KT has been active in separating them to guarantee management independence.”
Asked about its recent purchase of Enswers, he said, “Microsoft, Amazon, Google, and Apple expanded their business territories with active acquisitions. We are following a similar mold and this is the reason why we bought Enswers.”
KT recently acquired video search company, Enswers. The acquisition is valued is at 20.2 billion won, giving KT a 45% stake in the 45 billion won company. Enswers, founded in 2007, has a video service platform including its’ popular video search engine Enswer.me.
KT is planning to introduce a next generation video distribution platform which, when combined with cloud computing services, provides a complete content purchase, storage, and management solution.
In the meantime, KT has enabled itself to be reborn as a comprehensive communication company covering wire & wireless telephones, high-speed Internet, and IPTV since its merger with KTF on June 1, 2009.
