• Journal of the Korean Operations Research and Management Science Society
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• v.22 no.2
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• pp.169-180
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• 1997

In this study, we estimate the multi-service cost function of Korea Telecom in order to characterize the cost structure of the telecommunication industry in Korea. By examining the cost function of Korea Telecom, we show that telecommunication costs of Korea Telecom are subadditive. Therefore, we conclude that a natural monopoly exists in the telecommunication industry in Korea.

• Journal of Digital Convergence
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• v.10 no.4
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• pp.181-190
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• 2012

Cost of capital is one of the key factors of accounting regulation policy for telecommunication market. This paper aims at investigating efficient policy improvements concerning accounting regulation for telecommunication market focused on cost of capital calculation methods and its application. At First, cost of capital estimating method should be improved. In estimating the cost of equity capital, it is necessary to use benchmark method for Equity risk premium. It will reduce analytical errors caused by a rapid economic change and inflation. It is also more desirable to use debt premium adding method for the cost of debt capital. Optimal capital structure method may be considered a better way to estimates capital structure. Secondly, cost of capital estimating process also has to be reformed. Telecommunication industry changes rapidly so it does not reflect fast environmental changes. Therefore, cost of capital should be calculated every year. Cost of capital should be calculated by individual companies. There is information asymmetry between regulators and regulatees. Because of that cost of capital calculating process takes long time and cost a lot. To solve this problem, regulator should legislate on cost of capital calculation and then regulating companies report the calculating result. Lastly, major telecommunication companies are all listed now and it is possible to calculating it separately. We must continuously improve the estimating method and application of cost of capital and due to the fast growing of telecommunication industry. The process of determining the calculating method must be discussed and best method chosen.

• IE interfaces
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• v.20 no.3
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• pp.395-406
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• 2007

In the telecommunication industry, estimation of the cost of network facilities is very important since depreciation cost of the facilities accounts for a large portion of the product cost. Moreover, cost estimation in the industry becomes more difficult because of increasing indirect cost upon digital convergence, expanding multi-purpose facilities, complexity of service product, etc. Nevertheless, not much seem to have been done in improving estimation methodology of the cost of network facilities. As a result, the quality of cost information on network facilities has deteriorated, and now even decision-makers in the industry dismiss the information. Recently, two major telecommunication companies adopted a new network cost estimation method to deal with the issue. In this paper, we study the concept of new cost estimation method and the procedure to develop and apply it. We also suggest the method to carry out the cost allocation using Matlab which is more efficient and time-saving than other commercial cost calculation packages.

• Journal of Korea Spatial Information System Society
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• v.8 no.1 s.16
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• pp.107-118
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• 2006

In this paper, several network algorithms were tested to find an optimal one for telecommunication network design. Algorithms such as Dijkstra's shortest path algorithm, Ford-Bellman's shortest path algorithm, Prim's minimum spanning tree algorithm, and Kruscal's minimum spanning tree algorithm were reviewed and compared in terms of feasibility and resulted network construction cost. Then an optimal algorithm that is most suitable for telecommunication network design was selected. For more specific and quantitative analysis of the selected algorithm, it was implemented to a real telecommunication network construction site. The analyzed results showed that the suggested design method when compared with the conventional one, reduced the network construction cost considerably. The total network length estimated by the conventional method were 5267 meters while the suggested method resulted in 4807 meters. Thus the new method reduced the total network length by 8.7 percent which is equivalent to 97,469,000 Won of construction cost. Considering the frequent telecommunication network constructions, due to new urban developments in the nation, the economic benefit of the suggested telecommunication network design method will be significant. In addition to the construction cost savings, the suggested telecommunication network design procedure possesses several other economic benefits. Since the design procedure can be standardized and automatized, it can reduce the design cost itself and the skill acquirement periods required for new or inapt design crews. Further, due to the standardized and automatized design procedure, any telecommunication network design results can accessed more objectively.

• ETRI Journal
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• v.25 no.1
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• pp.55-58
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• 2003

We propose a new paging strategy to reduce paging cost by adding paging agents at base stations. When a mobile-terminated call occurs, the base stations look up the paging agents to determine if terminal paging is actually to be made. An analytical model based on a Markov chain is used to evaluate the performance of the proposed strategy. The numerical results show that the proposed strategy significantly reduces the paging cost compared with the simultaneous paging strategy.

• Journal of Korean Institute of Industrial Engineers
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• v.20 no.3
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• pp.55-63
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• 1994

Optional two-part tariffs are in growing use in telecommunication services markets. This paper considers the problem of designing profit-maximizing optional two-part tariffs for heterogeneous user groups. It is shown that, at an optimum, one of usage charges among a set of optional two-part tariffs should be made equal to marginal cost. It is also shown that, if demand curves cross, then one of usage charges at the optimum can be below marginal cost. An example with linear demand functions is given to illustrate the important features of optimal two-part tariffs.

• Journal of the Korean Operations Research and Management Science Society
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• v.22 no.3
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• pp.23-36
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• 1997

In the design of telecommunication network, the network configuration using hubbing topology is useful for designing and managing the network efficiently : i. e. all of central offices (COs) are grouped into clusters. Each cluster has one hub consisting of large-scale transmission facilities like digital cross-connect systems and ATMs. In clustering process, the community of interest and geographical factor should be considered. However, there exists a tradeoff between two factors. One is to minimize total link costs for geographical factor and the other is to maximize the total intra-cluster traffics for community of interest. Hence, this can be solved by multiobjective linear programming techniques. In this paper, the problem under considerations is formulated as two p-median subproblems taking into considerations total costs and total intra-traffics, respectively. Then we propose the algorithm to solve the problem based on the concept of cost-traffic tradeoff. The algorithm enables to identify efficient cost-traffic tradeoff pairs. An illustration is also presented.

• The Journal of Korean Institute of Communications and Information Sciences
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• v.9 no.2
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• pp.49-61
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• 1984

The tariff rate of telecommunication networks in Korea is analyzed and the plans for the realization of information society is suggested on this basis. The influence of the cost-down of telecommunication networks construction, the decentralization plan of telecommunication traffics and offer of new services on the decision of telecommunication tariff rate are also descussed here.

• Journal of Information Technology Services
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• v.9 no.2
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• pp.43-72
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• 2010

The Korean mobile telecommunication service market is faced with a tremendous competitive period, in which the market is entering into the maturity stage with launching of the 3rd generation service and with introduction of mobile number portability. In general, it is more important to sustain the old customers than to attracting new customers, as the life cycle of an industry is entering the maturity stage in which the growth rate of new customers is decreasing gradually or becoming stagnant. Until now, many researches had tested whether the customer satisfaction and loyalty were the core factors of sustaining customers or not. Also service quality and switching cost were given a remarkable attention for their possibility of exogenous factors, which could exercise effects to customer satisfaction and loyalty. In the same context, mobile telecommunication business has to seek a way to maintain the existing customers instead of promoting new customers. So this study investigates whether the service quality and switching barrier of mobile telecommunication could have effects on the customer satisfaction and loyalty, which are recognized as an efficient means to sustain the current customers. In order to test the hypothesis on the effects of service quality and switching barrier of mobile telecommunication to customer satisfaction and loyalty in Korean telecommunication industry, this study collected the questionnaire response data of students including middle and high school students and undergraduates, who are regarded as the major customers in that mobile telecommunication industry.

• IE interfaces
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• v.11 no.1
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• pp.33-40
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• 1998

The objective of this paper is to help organizations select a suitable telecommunications media and dynamic route guidance system (DRGS) for an intelligent transport system (ITS) taking into account both cost and functionality. The media selection criteria and wireless communications for an ITS are discussed along with various DRGS. We describe which kind of telecommunication media and DRGS are suitable. The strategy of an ITS in Korea is described in regards to telecommunication media and DRGS.