3G and HSDPA Data Service: Strategic Implications and Lessons from Korean Mobile Carriers

As 3G and advanced networks (HSDPA and HSUPA) grow in terms of subscriber numbers and the deployment cases globally, mobile carriers expect more data service revenue. Though most mobile carries have boasted their operations in 3G, especially capabilities to transmit high bandwidth data and content services, they are still relying on the revenue from voice, and most of its recent data growth is still coming from messaging.

As a pioneer for mobile service - by introducing the first commercial service for HSDPA service worldwide - Korea's 3G mobile services (over WCDMA, HSDPA, HSUPA networks) has surpassed 20 millions in total subscriber numbers with 43.4 % penetration rate, (as of May, 2009) which indicates that 3G service has a strong foothold in the market.

Along with Japan, Korea's penetration rate for 3G is the highest number in the globe. However, the mobile data revenue accounted for only 17.4% (as of EoY 2008) of mobile carriers’ total service revenue. Further, the share has been declining since 2007. There is a considerable discrepancy between 'Qualitative' (Data Revenue) and 'Quantitative' (Subscriber Numbers) matters in 3G service.

Given the status, Yonku & Kenkyu believes that the time has come to assess the state of the 3G mobile-service industry in Korea.

Based on Korean 3G and HSDPA/HSUPA service status and lessons, the report “3G and HSDPA Data Service: Strategic Implications and Lessons from Mobile Carriers" examined 3G markets especially Data and Content services, the aspect of consumers behavior and perception on 3G services, the real facet and problems in current 3G services, and implications and lessons envisioned by Korean 3G service mobile carriers.

The report suggests a competitive service positioning concept to increase data revenue from the perspective of mobile carriers. The report also entails Korean mobile carriers’ strategies to boost data service revenue in 3G by applying USIM based mobile convergence service and HSDPA+Mobile WiMax integrated services via the world first data handover between heterogeneous networks.

The rationale of this brief market report is to suggest more healthy market environment and the eco system for 3G markets. We have also raised some issues that are closely related with 'revenue stream' for mobile carriers and their content aspects.