Mobile communications in South Korea
Encyclopedia
The Mobile Communication Industry in South Korea
As of March 2009, the number of mobile subscribers in Korea
nearing 46 million total mobile
subscribers and the nation’s penetration rate almost 100%. Mobile telecommunications services in South Korea
are served by three operators: SKT
(SKTelecom), KTF
(Korea Telecom Freetel), and LGT
(LG Telecom). SKT represents 50.50% of the market share, KTF 31.54% and LGT 17.95% as of December 2007. The nation first launched its mobile telecommunication services in 1960.
Changes in the number of mobile subscribers are indicated in the table below:
unit: number of subscribers
In March, 1984, the Korean government permitted the Korea Telecom to establish the Korea Mobile Telecom as a subsidiary dealing with mobile services. The Korea Mobile Telecom was to provide analogue cellular service employing the method of AMPS (Advanced Mobile Phone Service) in Seoul
metropolitan area including Seoul, An-Yang, Suwon
, and Sung-nam. In May, 1988, the Korea Mobile Telecom launched a full swing mobile communication business, expanding its scope into areas beyond Seoul and its vicinity, and at the end of 1991, the entire nation came to enjoy mobile services.
In 1994, in an effort to restructure communications industry, the Korean government announced its selection of a second mobile service provider, Shinsegi (which was later merged into SKT in January, 2002), and privatized the Korea Mobile Communications. As a result, the era of monopoly ended in the nation’s mobile communications service, laying groundwork for duopoly
.
The market became truly competitive in April, 1996, when Shinsegi started providing services using the method of CDMA. In June, 1996, the Korean government selected PCS (Personal Communication Services) providers, which would compete with the aforementioned companies, the so called “second generation mobile services companies.” The goal of the government was to secure competitive environment in the nation’s communications market. The Korea Telecom Freetel, LG Telecom
, and Hansol PCS (merged into KTF in May, 2001) were the three selected PCS carriers and began their PCS business in October, 1997. With Shinsegi and Hansol PCS out of the picture, only SKT, KTF, and LGT are currently competing in Korea’s mobile communications market.
Each company's financial status as of 2006 is indicated in the table below:
unit: KRW million
{| class="wikitable"
|-
!
! SKT
! KTF
! LGT
|-
| Sales
| 10,650,952
| 6,057,350
| 3,943,456
|-
| Operating Income
| 2,584,370
| 668,747
| 416,532
|-
| Ordinary Income
| 2,021,580
| 513,770
| 83,700
|-
| Net Income
| 1,446,598
| 411,702
| 237,986
|}
The ARPU (Average Revenue Per User) of each company is as follows:
SKT is 44,599 KRW (as of 2006), KTF 38,899 KRW (as of 4Q/2006) and LGT 35,700 KRW
As of March 2009, the number of mobile subscribers in Korea
Korea
Korea ) is an East Asian geographic region that is currently divided into two separate sovereign states — North Korea and South Korea. Located on the Korean Peninsula, Korea is bordered by the People's Republic of China to the northwest, Russia to the northeast, and is separated from Japan to the...
nearing 46 million total mobile
Mobile phone
A mobile phone is a device which can make and receive telephone calls over a radio link whilst moving around a wide geographic area. It does so by connecting to a cellular network provided by a mobile network operator...
subscribers and the nation’s penetration rate almost 100%. Mobile telecommunications services in South Korea
South Korea
The Republic of Korea , , is a sovereign state in East Asia, located on the southern portion of the Korean Peninsula. It is neighbored by the People's Republic of China to the west, Japan to the east, North Korea to the north, and the East China Sea and Republic of China to the south...
are served by three operators: SKT
SK Telecom
SK Telecom Co., Ltd. or Sunkyoung Telecom is a South Korean wireless telecommunications operator, controlled by the SK Group, one of the country's largest chaebol. As a part of SK Group, SK stands for Sun Kyung.SK Telecom is a provider of mobile service in Korea, with 50.5% of the market share as...
(SKTelecom), KTF
KTF
KTF was a South Korean telecommunications firm, now merged into Korea Telecom, specializing in cellular, or mobile, phones. Since 1999, it has also developed extensive overseas operations. The company is credited with developing customised ring back tones...
(Korea Telecom Freetel), and LGT
LG Telecom
LG U+ is a South Korean telecommunications and Mobile phone operator controlled by the LG Group, one of the country's largest chaebol. It was formerly known as LG Telecom....
(LG Telecom). SKT represents 50.50% of the market share, KTF 31.54% and LGT 17.95% as of December 2007. The nation first launched its mobile telecommunication services in 1960.
Changes in the number of mobile subscribers are indicated in the table below:
unit: number of subscribers
| Dec. 2001 | Dec. 2002 | Dec. 2003 | Dec. 2004 | Dec. 2005 | Dec. 2006 | Dec. 2007 | |
|---|---|---|---|---|---|---|---|
| SKT SK Telecom SK Telecom Co., Ltd. or Sunkyoung Telecom is a South Korean wireless telecommunications operator, controlled by the SK Group, one of the country's largest chaebol. As a part of SK Group, SK stands for Sun Kyung.SK Telecom is a provider of mobile service in Korea, with 50.5% of the market share as... |
15,179,063[1] | 17,219,562 | 18,313,135 | 18,783,338 | 19,530,117 | 20,271,133 | 21,968,169 |
| KTF KTF KTF was a South Korean telecommunications firm, now merged into Korea Telecom, specializing in cellular, or mobile, phones. Since 1999, it has also developed extensive overseas operations. The company is credited with developing customised ring back tones... |
9,590,698 | 10,332,770 | 10,441,766 | 11,728,932 | 12,302,357 | 12,913,699 | 13,720,734 |
| LGT LG Telecom LG U+ is a South Korean telecommunications and Mobile phone operator controlled by the LG Group, one of the country's largest chaebol. It was formerly known as LG Telecom.... |
4,275,835 | 4,790,161 | 4,814,046 | 6,073,782 | 6,509,849 | 7,012,283 | 7,808,638 |
| Total | 29,045,596 | 32,342,493 | 33,568,947 | 36,586,052 | 38,342,323 | 40,197,115 | 43,497,541 |
In March, 1984, the Korean government permitted the Korea Telecom to establish the Korea Mobile Telecom as a subsidiary dealing with mobile services. The Korea Mobile Telecom was to provide analogue cellular service employing the method of AMPS (Advanced Mobile Phone Service) in Seoul
Seoul
Seoul , officially the Seoul Special City, is the capital and largest metropolis of South Korea. A megacity with a population of over 10 million, it is the largest city proper in the OECD developed world...
metropolitan area including Seoul, An-Yang, Suwon
Suwon
Suwon is the provincial capital of Gyeonggi-do, South Korea. A major city of over a million inhabitants, Suwon lies approximately south of Seoul. It is traditionally known as "The City of Filial Piety"....
, and Sung-nam. In May, 1988, the Korea Mobile Telecom launched a full swing mobile communication business, expanding its scope into areas beyond Seoul and its vicinity, and at the end of 1991, the entire nation came to enjoy mobile services.
In 1994, in an effort to restructure communications industry, the Korean government announced its selection of a second mobile service provider, Shinsegi (which was later merged into SKT in January, 2002), and privatized the Korea Mobile Communications. As a result, the era of monopoly ended in the nation’s mobile communications service, laying groundwork for duopoly
Duopoly
A true duopoly is a specific type of oligopoly where only two producers exist in one market. In reality, this definition is generally used where only two firms have dominant control over a market...
.
The market became truly competitive in April, 1996, when Shinsegi started providing services using the method of CDMA. In June, 1996, the Korean government selected PCS (Personal Communication Services) providers, which would compete with the aforementioned companies, the so called “second generation mobile services companies.” The goal of the government was to secure competitive environment in the nation’s communications market. The Korea Telecom Freetel, LG Telecom
LG Telecom
LG U+ is a South Korean telecommunications and Mobile phone operator controlled by the LG Group, one of the country's largest chaebol. It was formerly known as LG Telecom....
, and Hansol PCS (merged into KTF in May, 2001) were the three selected PCS carriers and began their PCS business in October, 1997. With Shinsegi and Hansol PCS out of the picture, only SKT, KTF, and LGT are currently competing in Korea’s mobile communications market.
Each company's financial status as of 2006 is indicated in the table below:
unit: KRW million
{| class="wikitable"
|-
!
! SKT
! KTF
! LGT
|-
| Sales
| 10,650,952
| 6,057,350
| 3,943,456
|-
| Operating Income
| 2,584,370
| 668,747
| 416,532
|-
| Ordinary Income
| 2,021,580
| 513,770
| 83,700
|-
| Net Income
| 1,446,598
| 411,702
| 237,986
|}
The ARPU (Average Revenue Per User) of each company is as follows:
SKT is 44,599 KRW (as of 2006), KTF 38,899 KRW (as of 4Q/2006) and LGT 35,700 KRW