The market for WLAN services has increased significantly in recent years. However, it is still in its infancy stage, judging from the limited number of users. The low level of usage can be attributed to limited coverage, lack of brand recognition for services currently available and to the lack of roaming agreements between services operators.
It was initially believed that mobile operators would quickly dominate the market for WLAN services, due to their large existing subscriber bases, fully deployed wireless networks and facilities and their established roaming agreements. In addition, they hold two main advantages: First, they can easily solve the problem of service coverage by providing WLAN services as complements to their existing mobile services. Second, they can leverage their well established existing brand recognition.
This situation only applies to the European and North American markets where small and mid-sized operators mainly offer WLAN services and because WLAN services are considered to be complementary to mobile services.
The situation with Korea is quite different. Boasting the highest broadband Internet penetration rate in the world, Korea``s large fixed services operators are already competing in the area of WLAN services. KT has already gained a strong competitive position and industry watchers believe it will continue to dominate the market, given its large number of high-speed Internet subscribers, which are likely to gradually migrate to WLAN services over time. KT``s brand is widely recognized, which allows the company to compete favorably with mobile operators. Finally, the extensive network deployment of KT should facilitate the creation of roaming agreements.