SK Telecom (NYSE:SKM) announced today that a consortium led by SK Telecom began operating national test networks for quantum cryptography communication in five different areas in Korea.

In July 2015 SK Telecom-led consortium* has been chosen by the Institute for Information & communications Technology Promotion under the Korean Ministry of Science, ICT and Future Planning to undertake a government-funded project on quantum cryptography communication network.

* The consortium consists of Wooriro Co, Ltd., HFR Inc., National Security Research Institute, Electronics and Telecommunications Research Institute, University of Seoul, KAIST, Korea University, Gwangju Institute of Science and Technology, and Quantum Information Communication Research Association.

The five national test networks cover areas between SK Telecom's Bundang Building and Seongnam District Center (17.8 kilometers two-way); Bundang Building and Yongin District Center (68 kilometers two-way); Bundang Building and Suwon District Center (53 kilometers two-way); Bundang Building and Yangpyeong District Center (107 kilometers two-way); as well as SuperSiReN network that covers 11 kilometers (two-way) in Daejeon.

SK Telecom's Quantum Cryptography System, developed since 2011, is the most secure encryption method that uses quantum physics instead of mathematics-based encryption algorithms being used today. That is, it securely distributes a secret key to legitimate parties. Here, a key is a table of random numbers shared by legitimate users in such a way that the information is known only to them, and secure means secure against any possible eavesdropping, which is the highest level of security. The system is expected to enhance security of critical network infrastructure.

With the rise of the Internet of Things (IoT) in an increasingly connected world, quantum cryptography technology is being highlighted as a possible solution to a whole new set of security challenges in the IoT era. Therefore, countries around the world are actively conducting research and development activities to develop quantum-based security system.

For instance, recently, the National Institute of Standards and Technology (NIST) under the U.S. Department of Commerce published a report stressing the importance of quantum resistant networking cryptography schemes to protect against the rapidly involving capabilities of Quantum Computers.

Going forward, the SK Telecom-led consortium plans to test long-distance transmission (over 200 kilometers two-way) by accumulating expertise and experience in operating the quantum cryptography communication system and achieving optimization of equipment performance for each different transmission distance. In addition, the consortium plans to interconnect the existing test networks while building new ones by 2018.

"SK Telecom consortium is proud to announce that it has completed the rollout of five different national test networks for national quantum cryptography communication that cover a combined total of 256 kilometers," said Alex Jinsung Choi, the Chief Technology Officer and Head of Corporate R&D Center of SK Telecom. "With the operation of the national test networks, we have successfully moved beyond the technology development phase onto the next stage where we test and verify the quantum cryptography communication system to ultimately achieve its commercialization."

About SK Telecom

SK Telecom (NYSE: SKM, KSE: 017670), established in 1984, is Korea's largest telecommunications company with more than 26 million mobile subscribers, accounting for around 50% of the market. The company reached KRW 17.137 trillion in revenue in 2015. As the world's first company to commercialize CDMA, CDMA 2000 1x, CDMA EV-DO and HSDPA networks, SK Telecom launched the nation's first LTE service in July 2011. SK Telecom also became the world's first mobile carrier to commercialize 150Mbps LTE-Advanced in June 2013 and 225Mbps LTE-Advanced in June 2014 through Carrier Aggregation(CA). In line with its efforts to swiftly move towards the next-generation mobile network system, or 5G, it successfully commercialized 300Mbps tri-band LTE-A CA. As of the end of December 2015, the company has over 18.98 million LTE and LTE-Advanced subscribers. Based on its strength in network operations business, SK Telecom is seeking new growth engines through three innovative platforms namely Lifestyle Enhancement Platform, Advanced Media Platform and IoT Service Platform. For more information, please visit www.sktelecom.com or email to skt_press@sk.com.

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