[Comprehensive] "This Time Bio" KT Ku Hyun-mo Expands New Business... Makes a Bold Move

[Asia Economy Reporter Joeslgina] "If the past year was a preparation process to transform KT into a new company, from now on, the strategy to make KT a digital platform company (Digico) will be fully implemented."

Marking the first anniversary of CEO Koo Hyun-mo's tenure, KT is accelerating its move away from telecommunications by adding 'bio' and 'smart logistics' related businesses to its corporate objectives. The core focus is on building a B2B (business-to-business) platform based on so-called ABC (Artificial Intelligence (AI), Big Data, Cloud) capabilities.

◇First Anniversary of CEO Koo Hyun-mo, Challenging High-Growth New Businesses

On the morning of the 29th, KT held a shareholders' meeting at the KT Research and Development Center in Seocho-gu, Seoul, where it approved an amendment to its articles of incorporation to add 'freight transportation and freight forwarding business' and 'manufacture and sale of medical devices' to its business objectives. This move signifies KT, traditionally a telecommunications company, making a full-scale entry into new bio-health and smart logistics businesses. CEO Koo emphasized, "We will challenge high-growth new businesses that will determine the future, such as bio-health."

KT's new bio-health business includes medical platforms targeting the surge in demand triggered by the COVID-19 pandemic. Representative examples include detection systems that use big data to warn of infectious diseases including COVID-19, and solutions supporting the distribution and storage of COVID-19 vaccines using advanced Internet of Things (IoT) technology. Healthcare linked with AI-based GiGA Genie, bioinformatics businesses, and platforms for non-face-to-face collaborative medical treatment between patients and medical staff are also among the candidates.

The smart logistics business centers on 'digital logistics' utilizing AI and big data. The digital logistics system piloted by KT last year at GS Retail's Goyang and Jeju logistics centers was evaluated for improving work efficiency by using AI to check inventory and key location information as well as designing transportation routes. Last year, KT also introduced autonomous driving logistics services such as 'Nareugo' and 'Ttareugo' to assist transportation tasks.

◇Expecting Synergy with ICT... Targeting the B2B Market

Both bio-health and smart logistics are core areas of the B2B brand 'KT Enterprise,' led directly by CEO Koo. In his first year in office last year, as digital transformation (DX) triggered by the COVID-19 pandemic spread across all sectors including healthcare, logistics, and education, he declared, "We will lead the B2B DX market by transitioning from a telco (telecommunications company) to a Digico."

In particular, bio-health is regarded as the field where KT's ICT competitiveness can create the greatest synergy. CEO Koo has paid attention to the fact that the telemedicine market, which is hampered by regulations in Korea, is explosively growing in countries such as the United States, Japan, and China, reportedly keeping the global market for ICT-based bio-healthcare platforms in mind.

Over the past year, CEO Koo's actions have focused on finding new businesses beyond telecommunications. Following the formation of AI One Team and Cloud One Team leveraging ABC capabilities, KT is also concretizing its B2B market strategy and group restructuring. This month, KT revealed a strategy to strengthen synergy among group media platforms by establishing Studio Genie, a content-specialized subsidiary.

Based on this, KT plans to challenge high-growth new businesses that will determine the future, such as media and content, robotics, and bio-health. The proportion of KT's wired and wireless communication sales decreased from 66% in 2016 to 50% last year, while the sales share of growth areas such as IT and future businesses rose to 50%. CEO Koo emphasized, "We will accelerate the restructuring of our business portfolio and grow qualitatively," adding, "Please look forward to KT's growth story."

Meanwhile, at the shareholders' meeting, KT appointed Park Jong-wook, Head of KT's Management Planning Division (President), and Kang Guk-hyun, Head of KT's Customer Division (President), as inside directors, presenting the direction for KT's leap to Digico. Lee Kang-cheol, an outside director with expertise in ESG, was reappointed. Kim Dae-yu, an executive in economic policy, was named as an outside director serving on the Audit Committee. KT explained that these appointments are expected to contribute to providing growth direction for KT's transition to Digico and to further enhance transparency in corporate management. The director remuneration limit was confirmed at 5.8 billion KRW, the same as the previous year.