North Korea launches 3G cellular service

A 3G cellular service was launched in North Korea by Cheo Technology, a company in which Egypt's Orascom Telecom holds a majority stake.

North Korea has taken a massive leap forward in telecommunications and launched a 3G cellular network but details about the service, how much it costs and who is eligible to use it remain a mystery.

The Koryolink network is operated by Cheo Technology and was launched at 5 pm local time (8 am GMT), said Rascha Mohamed, a spokeswoman for Orascom Telecom in Cairo. Cheo is a joint-venture company in which Orascom holds a 75 percent share and the state-run Korea Posts and Telecommunications Corp. (KPTC) holds the remainder.

Initially the network covers the capital city of Pyongyang but there are plans for service to be extended nationwide, Orascom said in a statement.

Cheo has been given a 25-year license to operate a WCDMA (Wideband Code Division Multiple Access) network in North Korea. For the first four years of the license, the operator has exclusive rights to operate a cell phone service and doesn't have to pay taxes for the first five years. Orascom says it intends to invest US$400 million in the network and the license fee during its first three years.

"This is not just about providing 3G mobile services; we are making history in a country that is developing and opening up in a remarkable way," said Naguib Sawiris [cq], Orascom chairman and CEO, in a statement. Sawiris was reportedly in Pyongyang to launch the network.

Orascom announced its deal in January and at the time said it planned to offer "voice, data and value-added services at accessible prices to the Korean people."

North Korea is one of the poorest nations in Asia and one of the most tightly controlled societies in the world. For many of its citizens a simple, analog dialtone would count as a "value-added service" so its with some interest that analysts are watching the network's roll-out.

North Korea launched a cell phone service in 2003 but access was restricted in 2004, shortly after a massive explosion ripped through a train depot in the north of the country within hours of the passage of a train carrying leader Kim Jong Il. North Korea-watchers suspect the train-yard explosion was an assassination attempt with the bomb triggered by a cell phone.

Cell phones smuggled from neighboring China are popular along the border area where Chinese cellular signals can be received to communicate and exchange information with family and aid groups based in China. However the phones are prohibited so must be used in strict secrecy.

While Orascom signed the cellular deal in January, it had been wooing the North Korean government for at least a year before that.

An unnamed company executive visited Pyongyang in January 2007 and held talks that led to the signing of a cooperation agreement between Orascom and the KPTC.

"Both sides agreed to realize long-term cooperation in the sector of telecommunication of the DPRK in the spirit of South-South cooperation and the principles of mutual respect and noninterference in internal affairs," the state-controlled Korea Central News Agency reported after the visit concluded.

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Martyn Williams

IDG News Service
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