Korean handset maker Pantech launches branded device with Telus

Pantech Wireless Inc., the US subsidiary of a Korea-based handset maker, is expanding beyond its original device manufacturing (ODM) business and coming to market with its own brand-name devices. While the company is already offering handsets south of the border, it recently announced that Telus Mobility is now selling the first Pantech-branded cell phone in Canada. The PN-3200 is a clamshell-style handset equipped with a VGA camera, video player, music player and a stereo speaker system. The device also has a speaker phone, voice activated dialing and comes with integrated Bluetooth. Quick factsPantech Group is the second-largest cell phone maker in Korea with 22% market share at the end of last year. Samsung is the largest with 45% and LG has 18%. Pantech sold approximately seven million units in North America and about 18 million worldwide last year. The company generated more than US$3.5 billion in worldwide revenue in 2005, and spent US$320 million on research and development, or about 10% of revenue. The Korean handset maker expects to build on its passed success and become one of the world’s major brands. Bryant Martin, director of channel marketing with Pantech Wireless in the US, tells Report on Wireless that the company isn’t satisfied with being outside of the top five cell phone manufacturers and that’s one of its major goals for the future. Martin spoke with RoW from California earlier this month and below is a transcript of the Q&A. Report on Wireless: Entering Canada with the deal with Telus, how significant is that for Pantech? Bryant Martin: It’s a continuing step in our growth as we move forward, but as our first branded product, it’s a pretty important step for us with 17 million subscribers there. That’s about half the population, so it’s a pretty important market for us and we’re excited to be moving forward with our branded products. RoW: The company is an ODM and manufactures devices for the other handset makers. Can you can give me a sense of where Pantech fits in the market? BM: The beautiful thing about being an ODM is most of that is under non-disclosure agreements, so we can’t really go forward and publicly say who they are. Although AudioVox, the UTStarcom, is one that’s known, but there’s been some others as well that I’m not at liberty to mention. RoW: Is the company in discussions with the other Canadian carriers? BM: We’re obviously looking to expand considerably on an international basis. We’re talking to a lot of carriers in a lot of other countries. I can’t disclose any specific discussions but I certainly hope that you will see Pantech-branded products throughout Canada. RoW: Moving to a brand strategy, how does that affect Pantech’s existing relationships with the other handset makers? BM: Well, it’s an interesting thing. We’re in a transitional phase where our long-term strategy is to be primarily a branded handset maker. That is our primary goal. Beyond that there are still obviously some ongoing relationships that are not completed yet at this time, but as we continue to grow you will see, I think, a greater shift towards more branded products. RoW: Where does Pantech expect to be a few years down the road? The company has just started its branded strategy. We know the big five or six handset makers control the majority of the market leaving little for others. Where does Pantech expect to be in that other category? BM: Actually, I’m hoping not to be in the other category. In the next approximately three years, our goal is to be in the top five. I’m not saying which of the top five but within the top five. RoW: That’s a pretty aggressive strategy? BM: It is, but we’ve got some fairly innovative products. We have very quick product cycles. Over half of our staffing is focused on R&D. It’s a really big focus for us, basically bringing products with more features and better designs to the market more quickly. RoW: With wireless already being a mass market product in a number of regions leaving only niche markets left, Pantech still expects to be a mass market player? BM: Yes, we have a broad range of products from the high-end customized smartphone-type products down to very simplified entry products that are targeted across the broad spectrum of the population. RoW: Does the legacy of being the second largest manufacturer in Korea with half of the company’s staff involved in R&D serve as expertise and experience to leverage going forward with the company’s brand strategy? BM: Absolutely. You may or may not know Pantech was actually the first company to have a phone with a CMOS camera. We actually built the first CDMA phone. We actually were the first ones with a megapixel camera phone, the first ones with the two megapixel camera phones. We’re the first ones with finger print recognition in a handset, though we haven’t brought it to North America yet. We were first ones with five-way navigation in a handset, basically using motion-sensing technology. So we’ve been driving technology into the products and basically trying to advance the development of the phone. RoW: What are some of the key features that we’re going to see in cell phones in the future? We will not even call them cell phones anymore, because it’s not just a phone. BM: If you look at one of our customers in North America, Helio, their whole tag line I believe is "Don’t call it a phone. Call it a device." Definitely things are moving in that direction. As to which features, I’m not actually going to point out specific ones at this time just because some of our advantage is our ability to do those things quickly and get there ahead of somebody else. Other than that, obviously you’re seeing a lot more of the higher speed of technologies with EvDO Rev A. For example we just announced with Sprint our first EvDO Rev A card that will be available in October in North America. RoW: Is HSDPA coming too? BM: We certainly have HSDPA UMTS products that we’re working on. RoW: Teens and young adults are a big target market, but what about the older crowd - the over-55? BM: Something that you will see a lot more of is product that is to some extent, simplified, not necessarily in features, but rethinking the user interfaces and figuring out a way to build a better product that’s easier to use. As you get into that older crowd, you start probably seeing larger fonts, larger keys, things that make the device basically easier to use. We don’t want to take functionality necessarily away but we want to make it simpler. RoW: Packing a lot more functionality into a cell phone is a big drain on the batteries. Where does Pantech see battery technology development going? BM: I think at this point most if not all manufacturers are exploring a lot of different battery technology. We’re looking at several.

Korean handset maker Pantech launches branded device with Telus

News | September 21, 2006

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