By Kim Tae-gyu
Home plus is considering pulling its budget mobile phone service, after three- and-a-half years.
The Seoul-based discount chain said Monday it is currently talking with the Ministry of Science, ICT and Future Planning over its license and 9,700 subscribers.
“We are considering pulling our mobile phone services but nothing has been decided yet,” said a Home plus official. “In any case, our top priority is our customers.”
In March 2013, Home plus joined hands with KT to become a mobile virtual network operator (MVNO), basically a mobile service operator that does not have its own licensed network or spectrum.
Instead, it buys mobile capacity from network providers and signs up users under its own brand. This helps outfits without the prohibitively expensive wireless pipeline jump into the cell phone service market using existing sales channels.
With a large number of hypermarkets across the country, Home plus seemed to be a perfect fit for the sector to provide inexpensive telecom services to budget-sensitive clients. Its bigger competitor E-mart also followed suit.
In 2014, its user base swelled to about 21,000 but that was almost halved over the next two years.
In order to focus on its distribution business, the company appears to think about bowing out.
If Home plus leaves, a network operator like KT or LG Uplus may take on the users, according to observers.
The country’s MVNOs topped 10 percent of the market late last year but they have struggled this year for various reasons. Their combined market share was 10.91 percent as of the end of this September.