The purpose of this report is to explore the major issues of convergence, a sweeping trend in the Korean telecommunication market. To this end, we studied the concept of convergence and its evolution direction. Through this study, we diagnosed technology forces, the most influential factor in the industry convergence.

This report provides very useful information not only to telecommunications companies and to device manufacturing companies, but also to broadcasters and MSOs who prepare for entering the convergence market.
Korea is one of the fastest developing countries where wired /wireless services are combined and integrated. Thanks to less regulated wireless internet networks, wired portal service providers can now place independent portal service menu in the start menu of wireless portals of mobile telecommunications companies. This raises possibility of competitive contents of wired Internet services coming into wireless portals of mobile telecommunications operators at a rapid rate.


In terms of satellite and terrestrial DMB services, Korea is also one of the most dynamic countries where broadcasters (including MSOs) join the wireless service and the combined services between broadcasting and wireless service are developed (by using CDMA network as a back up channel).

The reason for the title of this reports is ?Dynamics of the Korean Convergence Market in 2006?, not ?Dynamics of the Korean Communications Market in 2006? is that the Korean communications market would be led by a new convergence infrastructure by the integration of wire and wireless markets and integration of communications and broadcasting.

In this regard, it is essential to have a better understanding on several elements about Convergence in order to understand & forecast the Korean Convergence Market in 2006. ROA Group defines the concept of convergence as a value driver which creates a new value emerged from another new values or value networks.

?In terms of the industrial aspect, ?convergence? means the process, in which each individual industry creating different value chains or value networks in different areas is materialized into new value chains (or value networks) by the market?s invisible forces. ROA Group dubs it ?Industry Convergence?.?

Key Focus of this Report
This report focuses on ten major issues of the Korean convergence market in 2006, which are developed by Technology forces, the most influential force among four major forces, which are Technology Force, Regulations & Policy by the government, Consumer or Prosumer, and Key Player or Company.

The major technology forces rising as the key issue of the Korean convergence market in 2006 include WiBro, W-CDMA (HSDPA), DMB, IPTV, and VoIP. These five forces, as the next generation transmission devices, will be the driving force for creating a new service market while mass-producing new media contents.

The new media service will accelerate the advent of new portable devices and portable media. ROA Group selected user interface, simple phone, and ultra low cost mobile phone affecting portable devices as major three device issues of the Korean convergence market in 2006.

Issues of user interface and simple phone are closely related to the portable device lineup led by telecommunications companies, rather than the issues of device manufacturing companies since telecommunications companies are preparing for the launch of new media services.

Lastly, as new media services are created and developed, besides telecommunications service providers, new market participants preparing for joining the wired and wireless combined market are to be emerging as a new trend in the Korean convergence market in 2006. For example, huge Multiple System Operators (MSO) which dominate the wired broadcasting market with their cable network power are advancing to the telecommunications market. And, wired portal service providers (such as Naver, Yahoo Korea Inc., Daum, and Nate.com) are also joining the wireless market as the openness of wireless internet network is being accelerated.

Research Methodology
This report was developed, based on the wide-range of wired and wireless convergence related strategic research, consulting experiences and capability, interviews with telecommunications companies and device-manufacturing companies, and data collection by the consulting team of ROA Group and a wide range of research materials made by Research Information Center (RIC) of ROA Group. All market data numbers including market size for each next generation service mentioned in the introduction were projected by the analysis of ROA Group.

Who should read this report?
This report can serve as a reference to strategic planning or business planning for 2006 for domestic major telecommunications service providers and device makers. By covering major issues of the Korean convergence market in 2006, the report will be very helpful in preparations and understandings of specific future issues.

This report provides very useful information not only to telecommunications companies and to device manufacturing companies, but also to broadcasters and MSOs who prepare for entering the convergence market.

Finally, we believe that portable device related issues and service issues would be useful information to content providers who are preparing for joining new service market.