Convergence: more than the sum of its parts

John C. Tanner
17 May 2010

Best Converged Services

SK Telecom

Last year's winner:New category in 2010
Businesses segments:Mobile, wireless Internet, convergence services (telematics, S-DMB, RFID, digital home), video telephony, B2B
CEO:Jung Man-won
Key shareholders:Citibank ADR, SK Corp, POSCO
Key stats (2009):Revenue 12.1 trillion won ($10.9b), up 3.5%, net income 1.2 trillion won ($1b); 24m subs, 50%+ market share

The term "convergence" means different things to different people in the telecoms business. In the case of SK Telecom - this year's winner of Telecom Asia's first Converged Services award - it means services that are more than just the sum of their parts.

"Convergence is not simply putting one and one together to make two, but rather making it into five or even ten," says Jinhong Kim, senior VP at SK Telecom. "Successful convergence is not achieved by just combining technologies, but rather by finding the solution through examining culture - the way people live - and then adding to this an in-depth understanding of customer needs."

At the core of this strategy is having a better understanding of user behaviors and preferences within the context (and location) in which they use mobile services, says Kim. "As operators are more uncertain than ever about the preferences of mobile users, we need to be able to create and offer services that are more comprehensive and intelligent than before - not just market individual products and services but to organically interwork the various intelligent services and evolve into a convergence hub."

Kim mentions SKT's ringback tone service and its more recent T-Cash mobile payments service as successful examples of how its convergence strategy has paid off. But he adds that the services that generate the most enthusiasm from customers are the ones that serve everyday needs, such as T-Cash, mobile social networking service Cyworld, mobile gift coupon Gifticon and mobile navigation service T Map.

In terms of more practical advice in pursuing converged services, Kim puts a premium on partnerships - not just choosing the right partners, but also providing them as much value and satisfaction as possible.

There are also challenges, of course, from understanding customer needs and having core R&D capabilities in place to keeping an open mind on how business models and services should be created.

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