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Wednesday, July 09, 2003
KT, Sony to form strategic alliance on video game sales

Asia Pulse - KT Corp. the Korean’s largest fixed-line operator, and Sony Computer Entertainment Korea have decided to form a strategic alliance in the field of video game sales, according to industry sources.

Under the partnership, KT's Nespot, which has more than half of Korea's broadband Internet users, will have a joint marketing campaign with Sony to boost sales of Sony's PlayStation 2.

Subscribers to KT's high-speed network can have a 20-percent discount when purchasing a package consisting of PlayStation 2, periphery devices and Nespot products. Sales will likely begin from mid-July, according to company officials. "Because most Korean households are connected to high-speed Internet networks, we had difficulties in securing our own line to connect with PlayStation 2," said a Sony official. "The partnership with KT's Nespot will make it much easier to sell PlayStation 2." Officials from KT and Sony will hold a signing ceremony at the Renaissance Hotel in southern Seoul Thursday.

The alliance is likely to make a dent on the partnership between KT and Microsoft, which made a strategic investment in the Korean company in 2001, according to industry observers.

As part of its efforts to boost sluggish Xbox sales, Microsoft's Korean unit attempted to sell the video game console at discount prices under an alliance with KT,

Microsoft's video game console Xbox failed to prosper on the Korean market. Sony's PlayStation 2 has sold 500,000 to 600,000 units, but Xbox sales stood at just 25,000 to 30,000 units at the end of May, according to industry sources. Analysts have warned that Microsoft's lack of Korean-language software will lead to failure in its foray into the local market.

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