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Press Release
On August 31st, SK Telecom Board of Directors decided to extend its investment in HSDPA services to establish nationwide coverage by the first half of next year as an effort to enhance HSDPA services. SK Telecom initially planned to establish HSDPA network in 84 cities by the end of this year, and offer the service through DBDM handsets.
However, after careful review, SK Telecom believes the nationwide coverage and service offering through SBSM handsets will contribute more to the profitability and corporate value. Therefore, the Company decided to modify its current HSDPA network roll out plan. Incremental investment for establishing nationwide coverage is expected to be approximately KRW 640 bn, of which KRW 240 bn will be executed this year.
As a result, in 2006, HSDPA related CapEx will be adjusted to KRW 810 bn from initial plan of KRW 570 bn. However, SK Telecom will maintain 2006 CapEx guidance of KRW 1.6 triilion, as originally announced, through efficient curtailment of other areas along with effective management of CapEx. As for 2007, SK Telecom will do its best to keep the CapEx guidance similar to or less than that of 2006, despite the additional investment in HSDPA. The SBSM handset has competitive advantage in terms of price and function compared to the DBDM handset. It is expected to contribute to a successful adoption of HSDPA services with less marketing expenses. The handset will be available by the first half of next year upon the establishment of nationwide coverage of HSDPA services. In addition, SK Telecom will do its utmost to maximize network efficiency creating optimal network portfolio between existing network, such as CDMA, and HSDPA.
However, after careful review, SK Telecom believes the nationwide coverage and service offering through SBSM handsets will contribute more to the profitability and corporate value. Therefore, the Company decided to modify its current HSDPA network roll out plan. Incremental investment for establishing nationwide coverage is expected to be approximately KRW 640 bn, of which KRW 240 bn will be executed this year.
As a result, in 2006, HSDPA related CapEx will be adjusted to KRW 810 bn from initial plan of KRW 570 bn. However, SK Telecom will maintain 2006 CapEx guidance of KRW 1.6 triilion, as originally announced, through efficient curtailment of other areas along with effective management of CapEx. As for 2007, SK Telecom will do its best to keep the CapEx guidance similar to or less than that of 2006, despite the additional investment in HSDPA. The SBSM handset has competitive advantage in terms of price and function compared to the DBDM handset. It is expected to contribute to a successful adoption of HSDPA services with less marketing expenses. The handset will be available by the first half of next year upon the establishment of nationwide coverage of HSDPA services. In addition, SK Telecom will do its utmost to maximize network efficiency creating optimal network portfolio between existing network, such as CDMA, and HSDPA.