SKT chases AI vision as legacy business goes flat

Meet SK Telecom (SKT), the split personality telco.

One part is its legacy business, which plodded through another quarter to grow revenue by just 2% and EBITDA (earnings before interest, taxes, depreciation and amortization) by 3.6%. While net earnings spiked 37%, that was almost entirely due to higher dividends from subsidiaries. The core mobile business grew just 1.5%.

The other part is a company that's not holding back in its pursuit of AI. “SK Telecom is stepping up efforts on all fronts to transform itself into an AI company,” CFO Kim Jin Won told a results briefing Wednesday. Its strategy is to grow through partnerships with local and global top-tier AI companies while also continuing to develop its own AI technology.

Figure 1: SKT has expanded its telco business to emerging technologies like AI and the metaverse.
(Source: Ryan Pikkel on Flickr CC2.0)

Right now it's about to announce the formation of a global telco AI alliance. SKT isn't offering any more detail but says the new grouping grew out of meetings at MWC and will enable operators to build differentiated AI services that leverage their own capabilities.

SKT has been trialing generative AI in its A. (pronounced "A-dot") service, built on its own technology and capable of holding complex conversations and developing long-term memories. Last month the telco invested 15 billion Korean won (US$11.4 million) in local startup Scatter Lab, which has used deep learning to create a chatbot that can hold empathetic conversations.

Human-like conversations

SKT wants to work with Scatter Lab to develop an AI agent that can have human-like conversations with A. customers. The two companies also aim to develop a hyperscale language model equipped with emotions and knowledge domains.

AI aside, SKT also has plans for its Ifland metaverse platform. Following a global launch in 49 countries late last year, 10% of monthly active users (MAUs) are now from outside its home market, it says.

It has unveiled a new service on the platform known as "if home," a 3D personalized social media space that it hopes will drive interaction and activity. Later this year, it will introduce a content marketplace that will allow users to create and sell avatars or to sponsor celebrities.

While SKT's focus is on its AI prospects, it still has some sources of growth among existing businesses. One bright spot in Q1 was media, which grew 10% as a result of better targeting of customers, while the enterprise segment posted 5.8% in growth, with cloud and data center revenues up 22% and 28% respectively.

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— Robert Clark, Contributing Editor, special to Light Reading