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 Thursday, February 07, 2008

Korean market leader SK Telecom finished 2007 with 21.97m customers and a market share of 50.5%, up 0.1pp compared to the end of 2006. Quarterly net additions of 0.36m brought the annual total to just under 1.7m, an 8.4% annual growth rate. Revenue growth lagged behind customer growth slightly, a 6% rise taking the 2007 total to KRW 11,286bn. However, operating income was down 16% to KRW 2,172bn, and this impacted EBITDA, which was down 5% compared to 2006 at KRW 4,024bn.

One of the most remarkable aspects of SK Telecom's figures is the growth in the W-CDMA customer base, which we estimate to have reached 2.68m at year-end.

This represents an astonishing growth rate of 8847%, with the customer base at the end of 2006 standing at just 30k. However, this still leaves it short of KT Freetel's figure for 3G customers, which was 3.21m at the end of 2007 having launched in January 2007.

Clearly the appetite for 3G services in Korea is enormous. With 14% of Korea's total mobile customers owning W-CDMA handsets at the end of 2007 - up from 0.1% at the end of 2006 - it will be interesting to see how long it takes for 3G penetration to rise to the levels seen in Japan, where it currently accounts for more than half of the total.

Customers by Technology Standard

Source: Cellular News.