SK Telecom (NYSE:SKM) announced that it signed a Memorandum of Understanding (or MOU) with Lenovo, China’s leading PC and handset manufacturer, to cooperate in strengthening their competitiveness in the global content distribution market.

Under this MOU, SK Telecom will work together with Lenovo to provide T Store’s well-made contents to smartphones made by Lenovo and expand content distribution platform of T Store to a global scale, thereby supplying Korean contents to the global applications market including that of China.

The MOU can be seen as the first materialization of SK Telecom’s strategy, announced on 25 October, to nurture global platforms. Furthermore, it holds a significant meaning as it lays a foundation for high-quality contents made by Korean developers to enter into the global market.

Lenovo, based on its strong competitiveness in manufacturing built through its extensive experience in the PC industry and over 10,000 distribution channels, accounts for 12% of China’s Android-based smartphone market. The company has so far launched only one smartphone model named ’Le phone.’

SK Telecom expects a successful outcome in the Chinese applications market by combining Lenovo’s brand power with its competence in platform and contents proven through the success of its T Store in Korea.

With the aim to secure competitiveness in China’s content market, SK Telecom and Lenovo agreed to install a brand shop of T Store in Lenovo’s smartphones. The shop will mainly offer popular games and fun contents, as well as cultural contents such as music and cartoon that are likely to appeal to the Chinese consumers.

SK Telecom plans to focus on selling high-quality paid applications in the Chinese market, which is currently centered around free applications, so as to create a solid profit model for Korean application developers.  The company expects this move to result in a rapid increase in the number of T Store applications that target both Korean and Chinese customers.

To this end, SK Telecom has plans to develop a global content management system that links its T Store platform with Lenovo’s platform, making it easy for Korean developers to upload applications at the T Store brand shop and receive real-time download information. Moreover, the company has long-term plans to expand T Store’s content distribution platform to a global scale under close cooperation with Lenovo. 

Additionally, SK Telecom and Lenovo will join hands to exchange contents and support development of applications; foster developers by holding conferences; and conduct promotional events taking into account the local market conditions. By working together in diverse areas, the two companies aim to boost growth of developer ecosystem of Korea and China.

As part of the effort, SK Telecom will enable developers to easily create/verify applications optimized for Lenovo’s handsets by offering Korean-Chinese translation service and allowing the use of Lenovo’s target handsets at its MD Test Center. The company’s future plans also include developing a system that enables developers to create applications in many different languages simultaneously.

Hong Sung-Cheol, Executive Vice President and Head of Service Division at SK Telecom said, "The alliance between SK Telecom and Lenovo holds great meaning as it creates a new growth path for Lenovo as well as Korean developers by expanding SK Telecom’s service platform to overseas markets. Based on this MOU, SK Telecom aims to become a global platform company that provides a comprehensive service for application registration, distribution and management based on its T Store service platform."