Nortel wins piece of SK UMTS deal

Nortel Networks and LG Electronics have started their second UMTS rollout under their new partnership, this time with South Korea’s largest carrier SK Telecom.

Like the KTF deal announced last month, Nortel will provide UMTS base stations, radio access gear and its high-speed downlink packet access upgrade while LG will supply the packet core and switching infrastructure. The carrier will immediately launch the service first in Pusan, Korea’s second largest city, and follow with rollouts in the southern provinces of Gyeongsang-do, Jeolla-do and Jeju Island next month. The initial launches will be stand-alone UMTS, but Nortel said it would have the HSDPA upgrade in place by early 2006, effectively doubling the average capacity of the network.

Samsung is currently building out Korea’s largest UMTS network in Seoul, the capital city of 10 million, accounting for more than a fifth of the country’s population. SK Telecom began offering commercial service in Seoul in May.

Nortel is effectively becoming a UMTS powerhouse in Korea after appearing to lose ground in the highly insular market. By government mandate, Korean carriers are migrating from CDMA2000 to Wideband CDMA, and all new license holders are required to have 45 cities on the peninsula covered by 2006.

While SK Telecom built its original CDMA networks primarily with technology from local vendors like Samsung and LG, it sought outside vendors when it began planning its UMTS rollouts. In 2003, Nortel beat out Nokia and Alcatel to make the final round of competition for SK’s rollout, but when the carrier named its final vendors only with Samsung and LG remained on the list, Nortel being named only a supplementary vendor. Instead of the waiting for scraps, Nortel announced a joint venture with LG in January allowing the Canadian vendor to get its radio access network gear front in center before Korean operators while leaving the intricacies of Korea’s core network requirements to LG.

A month after finalizing the JV in August, the partnership announced its first deal with KTF.