KT Combines Forces with Cisco to Explore Smart Space Market

Strategic alliance for a smart space joint venture; collaboration in B2B and cloud computing areas

KT Corp. has forged a strategic alliance with the world's top communications equipment, solutions and systems provider, Cisco Systems, Inc., to make a foray into the smart space market in emerging economies in the Asia-Pacific region.
KT, Korea's number two telecommunications giant, and Cisco held a ceremony to sign a deal on the establishment of KCSS (KC Smart Service), a joint venture between the two companies, with KT Chairman Li Suk-chae and Cisco CEO John Chambers, as well as other executives from both sides, in attendance at Olleh Square in Gwanghwamun, downtown Seoul, on Nov. 8.
Even though Chambers was inside his company's headquarters in California, he participated in the ceremony through his company's high definition video conferencing solution, dubbed "TelePresence."
The telecommunications and IT convergence strategy announced by the two companies is a strategic alliance project combining KT's experiences in building and operating telecommunications infrastructure and ICT platforms and Cisco's world-class IT solutions and equipment capability.
The deal calls for the establishment of the smart space service provider, KCSS, and collaboration in global B2B and cloud computing business areas.
Smart space involves the redesigning of space with technologies such as ubiquitous sensor network (USN) and broadband convergence network (BcN). Smart space, is an upgraded version of the existing U-city, which is added to the "intelligence" and "mobile" concepts.
KCSS will specialize in designing urban areas where buildings, roads, transportation networks, and parks are applied with IT solutions and interconnected through networks. For instance, the room temperature, humidity, and lighting of an office can be controlled automatically. Also, an integrated traffic control center can take a look at a city's traffic systems, as already seen is some cases in Korea, including the development of Pangyo in Seongnam City, the "Smart City" in the Heungdeok District of Yongin, and the construction of the complex transfer center of Dongnae Station in Busan.
KT will be responsible for the overall management of KCSS, to be headquartered in Korea. With $30 million in paid-in capital, KCSS will have over $60 million in corporate value by receiving benefits from KT such as business opportunities and personnel & technology transfer.
KCSS will be allowed to utilize Ubi-Cahn, the smart space integration platform, developed by KT, which monitors, analyzes, and controls all sensors and systems. KT expects that the more KCSS expands its business environs, the more KT will be provided an opportunity to export the homegrown platform overseas.
KCSS's strategy is to focus on smart city/building/tenant areas in 14 countries in the Asia-Pacific region, including China, Japan, and Southeast Asian countries.
The new company aims at posting about 100 billion won in sales every year starting in 2014. KT said it is striving to rake in 2 trillion won in accumulated sales by 2021 by exploring the global smart space markets, including Korea.
KT said the more the smart space business is expanded, the better the quality of life citizens will be offered, thus putting forth a sustainable city development model and promoting the national green growth initiative.
KT and Cisco have agreed to aggressively promote cooperation in the B2B and cloud computing areas to make a joint foray into the global markets. The two companies decided to formulate a detailed collaboration plan to take advantage of their communications and IT capabilities by early next year.
KT Chairman Li said, "This project will be meaningful now that it involves the development of a joint business collaboration model from the long-term perspective that can bring about sales in a continuous manner, not releasing transient services and cooperation in consulting services." He added, "KT and Cisco will not only make their core solutions global products on the basis of their strong partnership, but also strengthen their capability in several areas such as the accumulation of business experiences and human resources development."
"We both view the market transition in the same way," Chambers said. He said that Cisco has been working together with KT for a long time and they share a vision of making the network a foundation for developing the smart space business. The Cisco CEO added that his company expects collaboration with KT to expand with the development of new businesses such as cloud services. nw

KT Chairman Li Suk-chae exchanges greetings with Cisco CEO John Chambers via the TelePresence system at a ceremony to forge a strategic alliance between the two companies in Seoul on Nov. 8.
Photo on courtesy of KT