LG Uplus bets on exporting 5G content

LG Uplus employees pose with mobile devices and placards bearing the names of the mobile carrier's 5G content services to commemorate the first anniversary of the launch of the company's commercial 5G service, Sunday. / Courtesy of LG Uplus

By Kim Hyun-bin

• Published Mar 31, 2020 4:43 PM KST
• Updated Mar 31, 2020 5:09 PM KST

By Kim Hyun-bin, Baek Byung-yeul

After a year of commercialized fifth-generation (5G) network service, LG Uplus is working on exporting its super-fast network-based content and technological knowhow to overseas carriers in an effort to create a more competitive business model and expand its presence, the company said Tuesday.

As one of the three mobile carriers that launched the world's first commercial 5G network in April, 2019, LG Uplus has heavily invested in developing more enjoyable content that runs on the next-generation network that promises low latency and speeds up to 100 times faster than LTE.

LG Uplus' market share in the 5G market is ranked third, chasing behind SK Telecom and KT. The company said producing more innovative 5G content is key to better positioning its products and improving its market share.

“LG Uplus kicked off the 5G network for the first time in the world, and we have been working on developing 5G-based content such as virtual reality (VR), augmented reality (AR) and cloud gaming services,” Kang Shin-goo, chief of LG Uplus' PR division, said.

“As the company is nearing the first anniversary of the launch of commercial 5G services, we are pushing for more exports of 5G content. Many overseas mobile carriers are increasingly showing their intention to purchase our content and content development knowhow,” he added.

Following an export deal of its 5G content to China Telecom last year, LG Uplus also signed a deal with Hong Kong Telecommunications in March to supply its 5G-based VR content. Based on the series of deals, the company is now in talks with telecommunications companies from Europe and Southeast Asia that plan to launch 5G services soon.

“We expect we could secure an increasing number of 5G content supply deals this year. After experiencing our services, many overseas mobile carriers are asking us to supply our 5G content,” Kang said.

LG Uplus has been trying to expand its presence in the 5G content market, especially the AR and VR sectors. It recently announced it would invest 2.6 trillion won ($2.1 billion) over the next five years in producing content that relies on the fast and low latency network.

Increasing profitability in the 5G market is one of the key tasks the company's CEO Ha Hyun-hwoi faces this year amid continuous investment in the 5G network and fierce marketing competition.

LG Uplus' third quarter operating profits dropped 31.7 percent compared to the same period the year before, a significant reduction compare to other competitors SKT and KT, which saw a 0.7 percent and 15.4 percent reduction respectively in the cited period.

In the meantime, LG Uplus mobile exceeded 15 million subscribers, just 10 months after it reached the 14 million subscribers mark in March 2019.

Since April 2019, the company recorded an 8 percent annual growth rate, much higher than its average annual growth rate over the past five years, which stood below 6 percent.

The company attributes the rise to 5G focused marketing especially in the U+VR·AR, Cloud games and diverse 5G contents, which have been successful in attracting customers in their teens through to those in their 40s.

Kids programs on the IPTV platform also garnered positive feedback from parents as did its partnership with Netflix, which provides a wide array of video content for TV and mobile subscribers.

“After the commercialization of the 5G network we were able to provide differentiated products through AR and VR content that led to an increase in mobile subscribers,” a company official said. “The demand from 5G customers is high as we can see in the customer data usage, where 5G customers double that of LTE customers.”