Apple iPhone hits shelves Nov. 28

KT Corp., Korea`s largest phone and internet company, said it will begin offering Apple Inc.`s iPhones on Nov. 28, becoming the first operator to begin selling the devices in the country.

KT plans to hold a launching event on that day for 1,000 customers who made advance reservations, the Seongnam, Korea-based company said in a statement yesterday. The 32-gigabyte iPhone 3G S will cost as little as 132,000 won ($114) when purchased on a 24-month payment plan, said KT, which is also introducing the 16-gigabyte 3G S and the 8-gigabyte 3G models.

Apple will compete in a market where Samsung Electronics Co., LG Electronics Inc. and Pantech Co. have more than a 90 percent share and more than nine out of 10 people already own a mobile phone. While the iPhone may help boost wireless Internet revenue for KT, competition may rise as Samsung and LG introduce new smartphone models in the country, according to analysts at brokerages including NH Investment & Securities Co.



"The iPhone will help increase usage of wireless data services, but there is also a chance of a marketing competition because of higher subsidies," Yang Jong-in, an analyst at Korea Investment & Securities Co., wrote in a report Nov. 17.

Korea is the only country other than Iceland among 30 members of the Organization for Economic Cooperation and Development that hadn`t introduced the iPhone, which is available in about 80 nations. China Unicom (Hong Kong) Ltd., the country`s second-biggest wireless company, began selling the handset last month in the world`s biggest communications market.

While it`s difficult to estimate iPhone`s shipments in Korea, sales of so-called smartphones, which allow users to surf the Web and compose e-mail messages, will reach about 800,000 units in the country this year and increase to 6.5 million in 2014, according to Hwang Seung-taek, an analyst at Hana Daetoo Securities Co. in Seoul.



Revenue from wireless Internet may account for more than 21 percent of total voice and data sales of Korea`s three mobile-phone operators in the fourth quarter next year, compared with 18.8 percent in the third quarter of 2009, according to Hana Daetoo`s Hwang.

"The impact from the iPhone may be limited to the high-end niche market," Song Jae-kyoung, an analyst at KTB Securities Co., wrote in a report Nov. 17.

"An aggressive push to win customers with higher subsidies for the iPhone may hurt profitability."

Cupertino, California-based Apple in June unveiled the iPhone 3G S, which is faster, more energy-efficient than its predecessor and has a built-in compass, higher resolution digital camera and is capable of recording video.

In the U.S., the iPhone 3G S starts at $199 for the 16- gigabyte version, while the 32-gigabyte model is $299. The older 8-gigabyte version of the 3G model sells for $99.

KT this month reported third-quarter net income more than doubled after a merger with its mobile unit drove up wireless revenue. Sales at the wireless division increased almost sevenfold to 2.5 trillion won, while revenue from traditional phone calls declined 6.3 percent, KT said.

KT`s share of Korea`s mobile-phone market fell to 31.3 percent in September from 31.5 percent a year earlier. SK Telecom Co., Korea`s largest mobile-phone operator, had a 50.6 percent share, while LG Telecom Ltd. had 18.1 percent, according to government data.

"The iPhone may improve KT`s ability to lure new customers, but the structural change in market share won`t be easy to come by just because of the iPhone," Choi Nam-kon, an analyst at Tong Yang Securities Inc., wrote in a report Nov. 17. (Bloomberg)