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South Korean W-CDMA base exceeds EV-DO in fourth quarter

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All three South Korean operators have now reported their Q4 08 results. The South Korean market is one of the most stable in the world, and it was thus no surprise that market shares remained unchanged both quarter on quarter and year on year, with SK Telecom (SKT) on 50.5%, KT Freetel (KTF) on 31.5% and LG Telecom (LGT) on 18.0%. In fact, barring a minor blip in June, there was no change in market shares on a monthly basis either throughout 2008.

The ranking for net additions followed the market ranking for the fourth successive quarter, with SKT gaining 156k, KTF 107k and LGT 70k. In total, the market gained 332k during Q4, the lowest fourth-quarter figure since 2002, to finish the year on 45.61m. SKT had 23.03m, KTF 14.37m and LGT 8.21m.

The market saw proportionate growth of 4.8% in 2008, down from 8.2% in 2007. There was little to choose between the three operators' annual growth rates: LGT grew by 5.1%, SKT by 4.8% and KTF by 4.7%. All three were down on their 2007 rates, with LGT losing 6.3pp, SKT 3.4pp and KTF 1.5pp.

However, the 3G sector continued to grow at an impressive rate. The W- CDMA base was up 189.5% year on year, overtaking the CDMA2000 1x EV- DO base during Q4 to finish the year on 16.51m connections. CDMA2000 1x EV-DO connections were down 12.6% annually to 14.92m. In aggregate, the two 3G technologies grew by 38.0% to 31.42m, which represented 68.9% of the total base, up from 52.3% a year earlier.

Despite the increase in 3G uptake, ARPUs showed little movement. SKT saw a 2.2% annual decline to a quarterly average of KRW 43,665, and LGT was also down 1.1% at KRW 36,120. KTF was the only operator to see a rise, gaining 2.5% to a figure of KRW 40,049. However, the disappointing performances for ARPU were not reflected in the service revenue figures. All three saw a gain, with SKT up 3.4% to an annual total of KRW 11,675bn, KTF up 7.4% to KRW 5,984bn and LGT up 5.6% to KRW 3,432bn. However, both SKT and KTF saw slight drops in annual EBITDA. LGT was up 14.9%, but it still had the lowest EBITDA margin of 22.7%, compared to 26.3% for KTF and 34.3% for SKT.

South Korea: 3G Customer Base by Technology

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Tags: 3g  arpu  cdma  lg  cdma2000 1x  sk telecom  ktf  cdma2000  kt  kt freetel  ev-do  lg telecom  Korea