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Consortium bids for 4th mobile carrier in S. Korea

Consortium bids for 4th mobile carrier in S. Korea
Written by Yonhap News

Consortium bids for 4th mobile carrier in S. Korea

SEOUL – A South Korean consortium applied for a license on Thursday to run the country’s fourth mobile carrier, promising to offer cheap mobile rates.

Currently, the country’s mobile network market is dominated by three mobile operators — SK Telecom Co., KT Corp. and LG Uplus Corp.

Korea Mobile Internet (KMI), comprising mobile virtual network operators (MVNOs) that rent networks from existing mobile operators, submitted a bid for a license to the Ministry of Science, ICT and Future Planning.

The ministry is expected to decide whether to grant a license to the consortium next year after reviewing its business plans and technical requirements.

Previously, the consortium had attempted to meet the requirements for a license, but the country’s telecom watchdog turned down its bid, citing its weak financial status and technical problems.

The consortium said once the regulator gives it the green light for its mobile network business, its services based on long-term evolution (LTE) time-division duplex (TDD) may start before April 2015 in the country’s 85 major cities and be expanded to other regions.

The LTE-TDD network is a fourth-generation mobile technology developed and led by China, while frequency-division LTE was adopted by South Korea, the U.S., Japan and other nations.

“We aim to attract 8.6 million subscribers five years after the launch of our service, and will turn to the black in 2020 as well,” it said.

KMI said it has attracted some 853 billion won (US$799 million) in capital from investors including China Telecom Corp., and secured technologies needed to meet the requirements.

KMI also said it has forged strategic alliances with numerous equipment makers such as Samsung Electronics Co. and Nokia Siemens Networks.

KMI said it plans to provide mobile services at rates that are 60 percent cheaper than those of existing services offered by the three major players.

The Park Geun-hye administration is seeking to lower mobile rates by abolishing mobile phone subscription fees as part of efforts to ease financial burdens on households.

Starting in September of this year, local mobile operators began to phase out sign-up fees for mobile phone services. The fee currently ranges from 24,000 won to 39,000 won.

The ministry expects that the elimination of mobile subscription fees will cut combined mobile charges by around 500 billion won annually.

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