Mobile in Korea

   Last week, the Board of Audit and Inspection of Korea insisted that Korean mobile operators, SKT, KTF and LGT got unjustified profits of $870 mil from customers in 2007. However, mobile operators criticized that the Board of Audit and Inspection of Korea ignored the environment of Korean mobile industy, so that the profits of $870 mil were assumed as unjustified profits.

  The main point is that the mobile rates in Korea are calculated based on the usage per 10 seconds. (Usually, the mobile rates per 10 seconds are about 2 cents.)  The Board of Audit and Inspection of Korea pointed out that, even if a customer hang up at the time point of 11 seconds after starting the call, the customer should pay about 4 cents - the rates for 20 seconds. The Board of Audit and Inspection of Korea requested that mobile operators modify the scheme of mobile rates based on the usage per 1 second.

  However, mobile operators mentioned that the scheme of mobile rates is resonable compared with the scheme of other countries' mobile operators. For example, the mobile rates of US are calculated based on the usage per 1 minute and those of some European countries are calculated based on the usage per 30 seconds. In addition, mobile operators insited that they have lowered the rates for mobile data service and video call.

  Since last year, Korean government has continued to put pressure on mobile operators to lower rates. As a result, mobile operators started to offer "intra-network" discount package. The intra-network discount system gives 1 50-percent discount for inner-network calls. For example, if a customer pay additional $2 for the discount service, the customer get a 50-percent discount benefit when calling to other SKT's subscribers.

  Moreover, SKT started to offer "family price discount plan" without additional charge. If members of a family subscribe SKT's mobile service, the members can get discount benefit when calling to each other. The discount rates have variation based on the subscription period of members.

  Even if Korean mobile operators offer various discount options, government put pressure on mobile operators consistently. Some experts are pointing out that the pressure for price discount might make mobile operators decrease the investment because of the expense pressure and the investment reduction might hamper the growth of IT industry in Korea.

my2pac

  In Korea, SK Telecom and KTF provide 3G services using HSDPA; LGT provides it using EV-DO Rev.A. In late April, SK Telecom and KTF attracted 9.97 mil subscribers (KTF 5.2 mil SK Telecom 4.7mil) who use 3G handsets on HSDPA network. In addition, LGT launched OZ service in early April and attracted 0.08 mil subscribers.

  Total subscribers of 3G service in Korea is 10.05 mil up to now. The rate of 3G subscribers is 22.5%;the number of mobile subscribers including 2G and 3G is 44.5mil.

my2pac

  The customer-centric service & price scheme has become very important in mobile industy of Korea. Since late last year, mobile operators have released various options about price discount in Korea. Recently, SK Telecom released a new discount option which provides 50% discount on calls among members of family. There is no additional chare for getting the discount benefit. Subscribers just submit a certificate which has all family members' names in order to get the discount benefit. Members of family, who want to get the benefit, must subscribe the mobile service of SK Telecom. If husband uses a service of SK Telecom and wife uses a service of KTF, the discount is not applied to calls between them.

  Yesterday, SK Telecom announced that this discount option attracted 0.5mil subscribers since the option was released in 1st April. It is very surprising that 0.5mil subscribers submit a certificate because a subscriber can submit the certificate directly through off-line customer centers, not on-line or phone-call to customer center.

  Although this discount option hinders the revenue growth of mobile operator, I assume that the options become strong weapons for customer retention. Because Korean market is saturated, the retention is the most important baseline for additional growth.

my2pac

  A few days ago, I posted 'Auction Cracked by a Foreigner'. LGT was also cracked by a Korean blogger and apologized to subscribers for LGT's fault officialy. The blogger who cracked LGT made a web page which provided name, social security number and handset model of the subscribers. In a result, 370 subscribers of LGT were exposed on the blog.

  The below is a captured picture of the web page which provided the information of subscribers. If a phone number was input on the quiry box and submit, the detail information about the phone number were showed on the page.

 

my2pac

  Auction announced that the informaction of about 10 mil Auction users were leaked out by a foreigner hacker who is presumed to be a chinese. The leaked information includes user ID, name, phone number, social security number and bank account number. Auction is the biggest e-market place in Korea.

  The korean police is investigating the worst hacking accident and many internet users are preparing for class suit. Internet users made internet communities on Daum and Naver for the sue. If a wave of lawsuit occurs, Auction might get a tremendous impact in terms of financial status.

  Today, I cheked whether my information is also leaked and my name, phone number, address and order list were leaked. I am concerning about the use by non-permitted person or group.

my2pac

   Nowaday, Korean operators are focusing on Video call which is one of 3G service. Aditionally, SK Telecom and KTF are pouring much money into TV commecials for video call. Let me introduce the TV commecials of SK Telecom and KTF. Even if they are made for Korean, it is easy for you to understand the meaning of commecials.

my2pac

   T and Show are brands of SK Telecom and KTF. Since last January, the operators have pumped much money into these brands.

   T means all kinds of SK telecom's service and is an umbrella brand of various service like T Roaming (Roaming service), T Live (Video call serivce), T LOGIN (Mobile broadband service) and so on. Show of KTF means KTF's 3G service including video call and HSDPA service. Currently, Show is recognized as more succesful brand by korean people. Many people think that TV commecials of KTF is more interesting and attractive.

my2pac