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With the rise of artificial intelligence and internet of things-related technologies, TV is becoming an important part of the smart home experience. In South Korea, where multichannel penetration is estimated to exceed 170% by 2019, telcos are leveraging established subscriber bases and adopting new strategies to drive the next wave of growth.
Most of the South Korean telcos' growth strategies are focused on developing new revenue streams from consumer interest in the connected or smart home while remaining committed to their multichannel and broadband businesses. An IoT hub, which connects devices and acts as a voice assistant to control the connected devices, is key to managing the smart home experience. Having released their branded smart devices that include this capability, KT Corp., SK Telecom Co. Ltd. and LG U+ are strategizing to upsell these devices and smart home services to existing subscribers.
The growth of the home IoT business is also anticipated to boost the broadband sector. South Korean telcos are focusing on upgrading households to giga plans with download speeds of 500 Mbps or more. In addition to the requirement on multichannel packs, SKT and LG U+ only offer a promotional smart home service discount to households who use giga broadband as part of the home service bundle. KT and LG U+ reported 5.2 million and 2 million giga broadband subscribers, respectively, as of June 2019.
Global Multichannel is a service of Kagan, a media market research group within S&P Global Market Intelligence's TMT offering.