SKT's App Store Aims Globally

Korea's top mobile operator has global ambitions for its mobile app store, but Korea's rules for device openness might not translate

September 8, 2009

3 Min Read
SKT's App Store Aims Globally

Korea's No. 1 mobile operator, SK Telecom (Nasdaq: SKM), has big plans for the mobile applications store it's opening, saying revenues could reach 1 trillion South Korean Won ($817.43 million) by 2013.

SKT's T Store is launching domestically after a successful beta trial that has been running since June, and is offering around 6,500 applications from the get-go. Initially, only SKT customers will be able to access the app store, but SKT says KT Corp. and LG Telecom users will be granted access "by the end of the year." The plan is to open the store globally by 2011.

The operator confirms that the store will operate on a revenue-sharing basis, with the developers setting prices and taking 70 percent of the revenue and SKT taking the residual 30 percent for "administration and marketing."

Developers will have to pay a yearly registration fee of KRW100,000 ($82), KRW200,000 ($163), or KRW300,000 ($245), depending on whether they want to submit two, 5five, or 10 applications per year. Every additional application then costs KRW60,000 ($49), although all fees are waived until the end of the year.

Every app also has to be approved, either through one of the Korean agencies, such as the Game Rating Board, Korea Media Rating Board, and Korea Contents Industry & Business Association, or by SKT's own verification team. SKT commits to completing its verification process within seven to 14 days, to keep apps flowing.

SKT has attempted to make T Store as open as possible to both Korean customers and developers. It is based on WIPI (Wireless Internet Platform for Interoperability) -- a Korean standard for application middleware, largely based on Java -- which means developers only have to develop once for their apps to work on more than 100 compatible terminals.

That openness was mandated in Korea until April this year. The change allowed other terminals into the market, such as those from Nokia Corp. (NYSE: NOK), and also set the rumor mill buzzing with talk of Apple Inc. (Nasdaq: AAPL) coming in with the iPhone. Despite this, the overwhelming majority of handsets remain WIPI-enabled, and some new entrants, such as Sony Ericsson Mobile Communications , are including WIPI for the Korean market anyway.

That said, WIPI has no traction outside of Korea, and SKT will have to find a new way of supporting multiple handsets when it moves outside of its home market. At press time, SKT had not responded to Light Reading Asia's inquiries on how it planned to do this.

Korea is renowned as a leader in mobile services, and around 95 percent of all devices support mobile Internet access and content downloads, according to the Korea Wireless Internet Service Agency (KWISA), and the National Internet Development Agency reported in October 2008 that 52.5 percent of the population from the ages of 12 to 59 were active mobile Internet users. As such, it is a market primed for an app store, and SKT is differentiating its offering by being as all-inclusive as possible.

The domestic success will depend on the appeal of the applications, and SKT is actively engaging with developers, running developer and ideas contests. The latter enables SKT to access interesting ideas from people who may not have the skills or resources to develop them into full-blown apps.

— Catherine Haslam, Asia Editor, Light Reading

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