KTF, a South Korean mobile carrier on the right rack from CDMA to WCDMA, is likely to have the upper hand in the 4G competition with SK Telecom.
SK Securities says in a recent report KTF smoothly migrating from CDMA to WCDMA will enjoy even further growth in high-end product sales and healthy customer basis with the advent of 4G.
According to the report, as prospective 4G standards are IP-based wireless data technologies and carriers are not likely to make a radical move toward mobile VoIP which will eat into their revenue, voice communications will be dominated by WCDMA for coming years. Under these circumstances, KTF which has gone bold steps toward WCDMA will gain a competitive edge over other carriers in cell phone procurement for WCDMA and 4G data (LTE or Mobile WiMAX) service which will be common in the 4G era, the securities firm remarks.
The report also says both LTE and WiBro are based on OFDM or Orthogonal Frequency-Division Multiplexing and talks about common chipsets are going on. Therefore, the report continues, it is meaningless to distinguish LTE from WiBro and “WCDMA+WiBro” cell phones such as Google Phone will come out next year.
SK Securities forecasts KTF will be affected by 3G impact which actually involves the establishment of 4G and the proportion of marketing cost and CAPEX to service revenue will go down to 26.2% and 10.2%, respectively, by 2010. Dismissing the concern about cannibalization of data revenue as a result of KTF’s using KT WiBro network, the report insists overlap between WCDMA wireless data service focusing on functional applications and WiBro centering on web access will hardly become an issue and the impact, if any, on revenue will be insignificant.
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