(Seoul, 5 March 2008) - SK Telecom (NYSE:SKM) announced today that the company has signed an investment agreement with Beijing Taihe & Rye Music Co., Ltd (TR Music, 北京太合麦田音乐文化发展有限公司) acquiring a 42.2% stake of the recording company. SK Telecom will participate in the management of the company as the equal majority shareholder along with Taihe Media, the current largest shareholder.

Through this agreement, SK Telecom successfully laid a strong foundation to enter one of the largest and most vibrant music markets in the world. SK Telecom expects the new partnership to create strong synergy effects with its other businesses such as mobile phone, content, and convergence services.

SK Telecom and TR Music held an official press conference at the Kerry Center Hall in Beijing today to announce their strategic partnership. Leveraging the expertise of both organizations, SK Telecom and TR Music will focus on pioneering new business areas, developing capable producers, fostering young talent while striving to develop new business models for digital music contents.

TR Music was established in 1996 and received funding from Taihe Media in 2004, thus paving the way for continuous growth. The company is now considered the largest music company in Mainland China, excluding international music labels. As one of the most well known record labels in China, TR Music owns the rights to around 1000 songs of top Chinese stars, such as Li Yu Chun, Pu Shu, A Dou, Sha Bao Liang, Man Wen Jun, and Zhang Ya Dong.

The Chinese music market is posting continued growth thanks to the broad consumer base, fast-growing digital music service, and government efforts to address the illegal market. With the advancements, SK Telecom plans to build the TR music into a major music label not only in China but also in Asia. The company will furthermore utilize the digital music contents developed through TR Music to become a leader in the Asian digital music industry.

Digital contents created by TR Music will also be offered through Viatech and UNISK, SK Telecom’s subsidiaries in China. This will help SK Telecom secure strong distribution networks in the digital contents market and create synergy with telecommunications and convergence business in the future.

At the press conference, the CEOs of SK Telecom’s two entertainment subsidiaries, Hun Tak Jung of iHQ and Seung Sung Hong of JYP Entertainment, signed an MOU with TR Music to cooperate in three areas - exchanges between singers and producers in China and other Asian markets, discovering and fostering talented entertainers, and in pioneering new entertainment markets.

The event attracted a large gathering of leading figures from China including government officials, business leaders, artists and journalists from over 80 media channels such as CNN and CCTV. The event drew the keen attention of all in attendance and demonstrated the overall excitement and expectations for what this strategic alliance will bring for the music industry in China.

"The China market features an unlimited growth potential in both music and convergence business. Through TR Music, we will enhance our core competitiveness in record production and expand business models in the digital music industry to become a leading music label in Asia. We will also continue to seek business opportunities in diverse areas of the Internet, media, and in content services," said Seok Hwan Lee, the president of SK Telecom China Holding Company.