Carriers vow to slash telecom bills
Minister of Science, ICT and Future Planning Choi Moon-ki, second from left, poses with KT Chairman Lee Suk-chae, third from left, SK Telecom CEO Ha Sung-min, right and LG Uplus CEO Lee Sang-chul, during a photo session before a meeting at the Westin Chosun Hotel in Seoul, Monday. / Korea Times photo by Shim Hyun-chul
By Kim Yoo-chul
Korea’s top three carriers agreed Monday to phase out the one-off subscription fees charged to mobile phone users by 2015. They will slash such fees by 40 percent in August this year.
“Chief executives at SK Telecom, KT and LG Uplus agreed to cut the subscription fees this year. Such fees will be scrapped by the end of 2015,” said the Ministry of Science, ICT and Future Planning in a statement.
The ministry expects the abolition of such fees, which range from 24,000 won to 39,600 won ($21 - $35) per user, to cut mobile charges by around 500 billion won annually.
But the statement didn’t include details of plans for the upcoming auctions for long-term evolution (LTE) spectrum, which the companies are desperately competing to win the license for 1.8GHz bandwidth, called the “golden spectrum.”
During a meeting with Science Minister Choi Moon-ki, the CEOs vowed to spend more money for balanced and mutual growth with local suppliers and partner companies in accordance with the government’s policy initiatives for the “creative economy.
SK Telecom CEO Ha Sung-min, KT Chairman Lee Suk-chae and LG Uplus CEO Lee Sang-chul attended the meeting.
This is the first time that the minister discussed pending issues with the chief executives, said the ministry spokesman.
But the minister hinted of stronger punitive measures against the telecom firms if they continue to offer illegal subsidies to entice new customers.
The firms have also spent enormously on their marketing campaigns in the first three months of this year.
Data provided by the ministry said SK Telecom ranked highest spending 900 billion won during the period, followed by KT with 700 billion and LG Uplus with 450 billion won.
“You should remember that more investment means increased hiring and more revenue to content developers and suppliers. I urge you to spend more for technology development and better networks rather than being involved in heavy marketing,” the minister cautioned.
Officials at SK Telecom and KT said they have not being notified by the ministry or the Korea Communications Commission over possible extra fines for illegal subsidies.
The companies received operational suspensions late last year, for persistently ignoring warnings against offering illegal subsidies.
The minister praised efforts by the carriers to back up the government’s plan to vitalize budget phones and to cut charges as part of reigning in inflationary pressure.
“I believe the carries are the trio for ‘creative economy’ and the government will try hard to create new eco-systems to help the local telecommunications industry on the right way,” said the minister.