Government Review Imminent... The Future of SK Telecom's Untact Plan

Review deadline including holidays until January 19
Government likely to impose conditions on budget phones
Connected to activation of online-only prepaid plans
Expected to pave the way for prepaid market revitalization

[Asia Economy Reporter Koo Chae-eun] SK Telecom's reported 'online-only plans' (untact plans) are expected to receive government review results within this week.

Industry insiders expect the plans to be approved without rejection. Although additional conditions such as providing wholesale rates for MVNO networks and lowering wholesale rates will be attached, the policy goals of promoting a contactless economy and activating the self-sufficiency market are met as the form of purchasing smartphones through online shopping malls has greatly increased.

According to the industry on the 11th, SK Telecom reported its 5G plans to the Ministry of Science and ICT on December 29 last year. The plans offer ▲9GB of data for 38,500 KRW per month ▲200GB of data for 52,500 KRW per month, and ▲unlimited data usage for 60,000 KRW. If the government does not reject the plans within 15 days, they are expected to be launched within this month.

A Ministry of Science and ICT official explained, "The 15-day deadline (the government's maximum review period) excluding holidays is until January 19, and the review results will be announced before then."

Concerns that the plans could negatively affect MVNO activation policies are expected to be resolved through wholesale network provision. Initially, the MVNO industry argued that the plans would harm fair competition with the MVNO market. However, since SK Telecom is a mandatory provider, it must provide wholesale when launching retail plans, and if the Ministry of Science and ICT negotiates the start time of wholesale provision and appropriate wholesale rates, there is little obstacle to launching the plans.

Above all, SK Telecom's untact plans align with the policy goal of 'activating the self-sufficiency market,' which has been promoted by both ruling and opposition parties during the 19th and 20th National Assemblies. It is analyzed that this could lead to 'launching mid-to-low priced untact plans → activating self-sufficiency device purchases → lowering smartphone retail prices.'

A National Assembly Science, ICT, Broadcasting and Communications Committee official said, "Although no separate bills related to complete self-sufficiency have been proposed in the 21st National Assembly, there is a general consensus on activating the self-sufficiency market," adding, "The more untact plans are launched, the more they can contribute to the self-sufficiency market."

The self-sufficiency activation policy means restricting bundled sales where telecommunication services and devices are sold simultaneously. The intention is to separate the collusive structure between telecom companies and manufacturers by preventing devices and telecommunication services from being sold simultaneously at telecom company stores and agencies. During the 19th Science, ICT, Broadcasting and Communications Committee, former Democratic Party lawmaker Kim Seong-su and former People Power Party lawmaker Kim Seong-tae proposed bills related to complete self-sufficiency.

An Jeong-sang, senior expert at the Democratic Party, stated, "Launching online plans can reduce marketing costs (from the telecom companies' perspective), contributing to consumer welfare and positively impacting the breaking of collusive distribution structures between telecom companies and manufacturers."

This content was produced with the assistance of AI translation services.