Friday, 14 August 2009

South Korea clarifies MVNO policy – South Korea

The South Korean telecommunications regulator, the Korean Communications Commission (KCC), has produced a wide-ranging policy designed to try and lower the cost of mobile phone charges.

KCC will require mobile phone operations to introduce three key changes designed to lower prices paid by consumers, including the cessation of subsidy based phone charges, a larger pre-paid credit distribution network and the adoption of an MVNO friendly strategy.

Although noting that the introduction of MVNOs will ultimately create a more competitive market which will, KCC hopes, drive down prices for the consumer, although there is scepticism within the industry about its vaunted aims and goals.

A source at South Korean telecommunications company KT was reported as saying: "When we talk about an MVNO policy, the chances for its success is low in South Korea. The telecommunication market here is fully saturated.

"Other measures will not be taken as operators fear they would result in falling profits."

The measures KCC have suggested come after a biennial report conducted and compiled by the Organization for Economic Cooperation and Development (OECD) showed that the average South Korean mobile phone user pays more for their mobile phone services when compared to other OEDC member nations.