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Courtesy of the Korea Consumer Agency
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KT has begun building a "speed-limit-less autobahn" to people's homes. It means that Korea¡¯s largest internet service provider will launch "fiber to the home" (FTTH) service. FTTH is a form of fiber-optic communications in which the optical cables are connected all the way to the user¡¯s home, thus greatly increasing the Internet speed.
KT President Nam Joong-soo says building the FTTH service was the biggest decision he has made as president. "Quite a few people opposed my idea, saying that it's not the right time. They pointed out the low profitability compared with the enormous investment," he said.
Nam spent many sleepless nights mulling the idea before ultimately deciding that this was the right time to take the risk. KT will spend W1.2 trillion (US$1=W933) by 2010 to install FTTH to all subscriber homes. Said to transmit data at "unlimited" speeds, the FTTH network will actually deliver data 10-50 times faster than asymmetric digital subscriber lines (ADSL) which use copper wires.
Nam referred to it as an "information autobahn" to the home. It will enable all communications services -- telephone, cable TV, and Internet -- through one link. Korea lags behind Japan in FTTH service although Korea introduced high-speed Internet before the island country, which now uses the service for digital broadcasting.
In this business, speed is directly linked with time. Nam said that speed and time determine success or failure in telecommunications. "Time is the most essential resource in the IT industry. To be a leader, it is important to reduce data transmission time by increasing speed," he said.
Internet companies are competing fiercely to increase their service speeds and reduce data transmission times. LG Powercomm was the first company to launch ultra high-speed Internet service. Beginning operations in September 2005, it secured 1 million subscribers in just one year, an industry record. It received an explosive response from consumers by promoting the fact that its service transmits data at 100Mbps, 10 times faster than its competitors.
Baek Yong-dae, an LG Powercomm manager, said, "That showed how much consumers wanted faster Internet service." Many people didn't have the patience to wait long hours to download movies and TV shows. KT and Hanaro Telecom jumped on the bandwagon by making extensive investments in the business. That's made it possible to send and receive large multimedia files at bullet speeds.
As of the end of February, KT had the highest number of optic LAN subscribers with 1.69 million, followed by Hanaro with 930,000 and LG Powercomm with 590,000. Optic LAN uses fiber-optic cables in only part of the system.
Hanaro Telecom plans to spend W110 billion this year to increase its optic LAN subscribers to 1.56 million. To provide the 100Mbps service at reasonable prices, it adopted the "ethernet to the home" (ETTH) technology, which delivers data from an Internet company to the user's area through optical cables and from there to the user's home through copper wires.
Choi Yong-seok, a product planning manager at Hanaro Telecom, said that his company plans to upgrade the network for household subscribers so that it can transmit data at 100Mbps.
But KT's FTTH, which costs more, enables data to reach the user through optical cable the whole way, providing faster service than ETTH. LG Powercomm also plans to spend W360 billion to upgrade its network and increase its subscribers to 2 million.
(englishnews@chosun.com )
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