NewNew 3G3G ServicesServices StrategyStrategy TowardToward GrowthGrowth

MayMay 24,24, 20062006

3G CDMA Latin America Regional Conference 0 TableTable ofof ContentsContents

WirelessWireless IndustryIndustry inin KoreaKorea

StrategyStrategy towardtoward GrowthGrowth

What’sWhat’s Next?Next?

1 KoreanKorean WirelessWireless MarketMarket SK Telecom Remains the Undisputed Leader

Market Share by Subscribers Revenue (US$mn) (‘000s, %) B Co 17.0% 10,161 6,510 5,008 SKT 19,530 50.9% 2,675 12,302 A Co 32.1% SKT A Co B Co

Marketing Expense to Sales EBITDA (Margin)

(%) (US$mn)

% of 4,288 17.2% 19.1% 21.8% Revenue

(42.2%) 1,945 719 (38.8%) (26.9%)

SKT A Co B Co SKT A Co B Co As of 2005 End 2 Source: MIC, Earnings release WirelessWireless DataData ServiceService SKT has higher data revenue portion than most global peers. It also leads data service in Korean market including EV-DO service

Global Leadership in Data Services Comparison to Domestic Peers

15% 8% 26% 26.7% 25.1% 24.8% 92% 74% 85%

SKT A Co B Co Peer Avg.: 16.1% Voice Revenue Data Revenue 12.2% Source: 2Q ’05 earnings release for the companies, respectively

8.4% 8.3% EVDO Subscribers

A Co 34% SKT Verizon Sprint Telefonica Vodafone Docomo SKTSKT 66%66%

Source: Global Mobile, As of 3Q ’05 Source: 2Q ’05 earnings release for the companies, respectively 3 MaturingMaturing Korean Korean WirelessWireless MarketMarket Limited Potential for Growth in the Conventional Voice Market

Korean Wireless Market Trend SK Telecom’s Revenue Growth

(‘000s, %) (US$mn) 10,161 10,500 9,520 9,704 8,634 79.1% 38.7% 75.9% 6,227 70.1% 67.9% 38,342 36,586 61.2% 10.3% 33,592 32,342 1.9% 4.7% 3.3% 29,047 2001 2002 20032004 2005 2006E Revenue Annual Growth SK Telecom’s ARPU Trend (US$) 44.5 44.2 43.9 43.5

2001 2002 2003 2004 2005 Subscribers Penetration Source: MIC, NSO 2002 2003 2004 2005 4 StrategyStrategy towardtoward GrowthGrowth SKSK Telecom’s Telecom’s GrowthGrowth StrategyStrategy Domestic Business Complemented by New Business to Enhance Growth

Data Business

Convergence DomesticDomestic GXG MNOMNO BusinessBusiness Satellite DMB Cyworld Melon Telematics Global Business

NewNew BusinessBusiness

Digital Home US & Vietnam

Reinforce Domestic MNO Business through Introduction of New Services under a Convergence Environment and Enhance Global Business Initiatives to Create New Business Opportunities 6 StrengtheningStrengthening DataData BusinessBusiness Data Business to Fuel Top-line Growth

SK Telecom’s Major Brands for Its Wireless Data Services

Online & Mobile Integrated Services

Music Portal Cinema Portal Game Portal Telematics Financial Services Service

3G Multimedia Security Service Messaging Mobile Blogging Smart UI Service Service Service Color Mail

SK Telecom’s Terminal Platform

7 LeadingLeading DataData ServicesServices

MelOn is Korea’s Number One Paid Music Site in Terms of Revenue and Subscriber Base

PC

Mobile Phone MP3 Player

World 1st Convergent Music Portal Innovative Business Model Performance Update (’05) Monthly flat rate for unlimited 4.2M members with 600K Over-the-air music download service paying subscribers Real-time music listening Partnership with Intel to Revenue of US$45 million Music playable on mobile integrate with Intel’s Digital 2006 Target: 8 mn members, handset, PC and MP3 player Home Platform “Vive,” 900K paying subscribers and enabling access from TV revenue of ~US$70 million 8 LeadingLeading DataData ServicesServices

“Cyworld” is a popular wired & wireless community & blog service which became the trademark of ubiquitous and convergence service among Korean youths

메뉴

Mobile Cyworld Access Mini Homepage http://www.cyworld.com & Mini Homepage Main page with mobile phone

Web-based Community & Evolution to Convergence by Performance Update (’05) Personal Blog Service Mobile Integration

Decoration of Mini Homepage Access to the same online 1.2M cumulative mobile with photos, music and avatar service thru mobile phones Cyworld users Revenue of US$50 million Successful item sales model Ubiquitous features such as 2006 Target: 1.9mn cumulative Easy to navigate friends’ Mini updating Mini Homepage anytime anywhere mobile Cyworld users and Homepages revenue of US$55 million

9 LeadingLeading DataData ServicesServices

SKT’s premium game service portal, GXG, allows game manias to experience the extreme in mobile 3D games through various GXG- enabled mobile handsets

GXG Game Phone Models

3D game portal site launched in April 2005 Expect increased use in line with Popular PC, arcade & console aggressive expansion of HSDPA in 2006 games enjoyed any time, any where via mobile phone! 10 Convergence/UbiquitousConvergence/Ubiquitous BusinessesBusinesses Satellite DMB & Other New Businesses to Provide Platform for Growth

11 MobileMobile ConvergenceConvergence ServiceService Satellite DMB to Provide Platform for Growth

Satellite DMB 2005 Performance Service Feature Overview Commercialized in May 2005 to Price Plan strengthen top line growth via rental, Subscription US$20 Monthly US$13 monthly and activation fees Fee Fee

2005 Operating Performance Channel Lineup

► Subscriber: 400,000 Subscribers Movie, Music, Drama, Video 11ch Sports, Game, News, ► Revenue: US$21.5 million Education, Business, Etc. 2006 Subscriber Target: 1.2 million Music, News, Education Audio 26ch (Non-stop Music, DJ Music, Subscribers Variety, Etc.)

Satellite DMB has many advantages as; 25 Terminal Line-up by the End of 2005 ► It provides more extensive contents ► Numerous handsets facilitate Satellite DMB ► Provides a wider geographical coverage

12 MobileMobile ConvergenceConvergence ServiceService

Financial Services

Take out the chip from the credit card

Insert the chip into the back of “Multi-purpose Card” handset

It is ready to use now • Credit card, e-cash, bus & subway card Multi- • Membership: TTL, OK Cashbag™, etc. feature • Future: ID, medical insurance card, In partnership with banking, etc. Credit Cards E-cash Mileage • 0.9% of every credit card transaction -Visa Cash Point amount is put into mileage -LG

All-channel - Samsung • Off-line, online, mobile payment Payment -Korea Exchange Bank - Koram Bank -HanaBank

13 MobileMobile ConvergenceConvergence ServiceService

Telematics - NATE Drive

Personalized Navigation Service • Finds shortest route based on real time traffic information - traffic jam, emergency

• Voice-activated navigation • Launched in Mar 2002 - 300,000 subscribers (June 2005)

• Launched telematics service in Jeju island (Dec 2004)

14 DataData BusinessBusiness PerformancePerformance Revenue from Wireless Data Services Showing Robust Growth

Wireless Data Revenue* (US$mn) Wireless Data Revenue as % of Cellular Revenue

27.7% 27.6% 26.0% 25.0% 23.9% 661.5 653.0 597.0 547.7 544.2

'04 4Q '05 1Q '05 2Q '05 3Q '05 4Q

* Excluding revenues from connection fees 15 DataData BusinessBusiness PerformancePerformance

SKT’s Data Service Revenue Comes Mostly from Rich Contents 100% 14% 10% Data ARPU Portion* Sub-total: 86% 8% 8% 10% 4% 28% 18% 8% 5% 3% 9% 90% 31% 72% 82%

SKT KTF LGT y Voice Revenue Data Revenue it g ic e o S lt re n in rs s m e u u u g e SMS u a id B d t a h L A ic m s t * As of 2005 4Q M G V P m s O o e C M Data ARPU by Handset Type

(Million Subs) 18.8 19.5 18.3 EV-DO 50 (US$) 19.5% 34.5% 41.6% 18 36% of Total ARPU

59.3% 56.2% 53.4% 1X 35 8 22.3% of Total ARPU 21.2% 9.3% 5.0% 1xEV-DO / June 1X (4Q 05) 2003 2004 2005 IS-95A Total ARPU Data ARPU 16 GlobalGlobal BusinessBusiness

Building Global Value Network for Economies of Scale and Cross Benchmarking

Platform Licensing Network Consulting Portal ► Israel (Pelephone) ► Telstra in Australia ► UNISK and Viatech in China ► Taiwan (APBW) ► China Unicom - UNISK: JV with China Unicom ► Thailand (TA Orange) ► KDDI and NEC’s Operation - Viatech: Community Portal ► Singapore (, M1) Partner ► (TelkomSel) ► Philippine (SMART)

Mongolia

Israel China Japan USA

Vietnam Taiwan Philippines Thailand Singapore MNO Indonesia ► S Telecom in Vietnam - Committed to build nation- wide coverage Australia ► SkyTel in Mongolia MVNO ► HELIO in US

17 GlobalGlobal BusinessBusiness Closer Look at Helio JV in the US

Tech-Savvy Youth & Young Adults Target Customer (Fun& Entertainment Seekers/Prosumer /Affluent) Korean American Community

Nationwide services leveraging the nationwide network coverage of Target Coverage host wireless carriers

Entertainment data services (VoD, M0D, Game, Etc.) leveraging its Killer Contents proximity to Hollywood and Silicon Valley

Distribution Building sales channel strategy aligned with new brand Channel Partnering with leading youth portals to maximize online sales

Building the company’s own wireless Internet platform, billing & Infrastructure customer care system, etc. led by SK Telecom

18 19 20 What’sWhat’s NextNext ?? SuccessSuccess FactorsFactors

Broadband Network • optimal portfolio of broadband Integrated Service NetworkNetwork networks suitable for each service characteristics • convergence services driven from customer’s needs Service

Convergent Terminal TerminalTerminal • Hybrid functionalities • Highly flexible to new services

22 IntegratedIntegrated ServiceService Each industry’s characteristics, such as communication’s interactivity, internet’s content and community, are integrated to create new services

NATE Drive SatelliteSatellite TelematicsTelematics Interactivity DMBDMB

MobileMobile InternetInternet

WirelineWireline WirelineWireline InternetInternet Content Community InternetInternet

• Melon(music) • Cizle(movie) • ddangkong(game) • Cyworld(homepage) • Nate on(messaging)

23 NetworkNetwork PortfolioPortfolio Growth from Technology Leadership

Multi-access Technologies Optimal Network Portfolio

Improve Data Rate & Mobility High-speed Data Demand

WLAN Hot Spot Mobility 95A/B EV-DO EV-DO rA 1X WCDMA HSDPA WiBro Hot Zone

WiBro WCDMA Cities

WLAN 2G/1X/DO Nationwide Coverage

Data Rate Coverage

Combination of networks Optimal Network Portfolio Service Convergence Seamless handover

24 ConvergentConvergent TerminalTerminal -- EvolutionEvolution

’04’04 4Q4Q ’05’05 1Q1Q ’05’05 2Q2Q

SCH W-120 SCH B-100 IM-8200 • WCDMA • S-DMB • S-DMB Ubiquitous MMMB • 1X/DO • JUNE • JUNE • JUNE • QVGA • QVGA Interface • WiBro PH-S4 • RFID MONETA • MONETA • ZigBee SCH V-650 M-Bank • 2 mega pixel SCH V-600 • JUNE,MP3 • QVGA • JUNE,MP3 • WIPI2.0 • MONETA Perceptual SV-520 • QVGA • 1.3 mega pixel Interface • JUNE,MP3 • MONETA Multimedia • 1.3 mega pixel • Healthcare A-GPS (Sensor) • Mini SDm • JUNE • QVGA SCH S-250 Integrated • 5 mega pixel Camera • 5 mega pixel Function • Intenna • 3X Zoom • Mini-HDD • QVGA • 7 mega pixel • VGA PH-S3500 PH-S6000 • Smart chip • GIGA GIGA Game • Bluetooth • 86M memory • 2 mega pixel • GIGA • WIPI1.2

25 SummarySummary

High quality 3G networks and capable terminals enabled value added services with increased ARPU

Convergence is the key word for the future

Strengthening global partnership to identify new business opportunity together

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