SK Telecom is focusing on new ICT businesses to enhance its corporate value.
All of Korea’s three major mobile carriers performed poorly in the third quarter due to investment in 5G telecommunications and increased marketing costs. However, in the case of SK Telecom, non-mobile sales accounted for more than 45 percent of consolidated revenue in the third quarter. The media, security, and commerce businesses lead SK Telecom’s transformation into an ICT company.
In particular, SK Telecom has emerged as a major player in the over-the-top (OTT) market by launching Wavve in September through a merger between Pooq and Oksusu. Wavve had 1.4 million paid subscribers as of late October and aims to attain five million paid subscribers by 2023. In September, the first month of its launch, Wavve beat Netflix with a monthly average of 2.64 million users.
Wavve looks to lead the Korean media ecosystem by producing original content. It will combine SK Telecom's platform and service capabilities and real-time broadcasting and content competitiveness of three network TV companies of Korea. Wavve has recently receieved 200 billion won in investment from the SK Securities PE-Mirae Asset Venture Investment consortium and completed the issuance of convertible bonds to strengthen its content capabilities. Moreover, SK Telecom holds 90 billion won in its pocket, which was raised via a capital increase.
Furthermore, SK Telecom signed a strategic partnership deal with Kakao in October and agreed to exchange equities worth 300 billion won. The deal is designed to enhance global competitiveness of the Korean ICT industry based on openness and cooperation. As a result, SK Telecom now owns a 2.5 stake in Kakao, which in turn has a 1.6 percent stake in SK Telecom.
SK Telecom's new ICT businesses are expected to gain strong momentum as the two companies will pursue omnidirectional cooperation in four areas -- telecommunications, commerce, digital content and future ICT.