[Comprehensive] "30% Cheaper" Government Also OK... SKT to Launch 5G Untact Plan on the 15th

[Asia Economy Reporter Joesulgina] SK Telecom will officially launch a 5G Untact plan priced in the 30,000 KRW range, which is 30% cheaper than existing plans, on the 15th. This plan, the first case since the introduction of the reservation notification system, is expected to mark the starting point for intensified 5G price competition among operators. The government accepted this plan, noting that SK Telecom lowered prices by responding to the overall trend of contactless services in society and reducing distribution costs.

◆ SKT Launches Six Online-Only Plans 30% Cheaper

SK Telecom announced on the 13th that it will launch a new plan called the ‘Untact Plan’ on the 15th. The ‘Untact Plan’ consists of six online-only plans: three 5G plans and three LTE plans, available for subscription through SK Telecom’s official online mall, T Direct Shop. For 5G, the plans offer 9GB of data for 38,000 KRW per month, 200GB for 52,000 KRW per month, and unlimited data for 62,000 KRW per month.

This is about 30% cheaper compared to existing 5G plans. Unlike previous plans that included contracts, bundling conditions, and additional benefits, this plan lowers the 5G fees that had been criticized for being expensive.

SK Telecom stated, "Considering customers’ needs to use mobile communication services ‘easily, simply, and affordably,’ we directly reflected the savings from reduced distribution and marketing costs of offline-based plans into the monthly fee, focusing on the essence of mobile communication services: ‘affordable fees’ and ‘increased data provision.’"

The ‘5G Untact 52’ plan priced at 62,000 KRW per month is almost equivalent to SK Telecom’s existing large-capacity LTE data plan ‘T Plan Essence’ (69,000 KRW per month, providing 100GB of data) with a contract discount applied. SK Telecom emphasized that it is now possible to use a large-capacity 5G data plan at the same level as existing LTE plans.

For LTE as well, plans allowing the use of large-capacity data of 100GB in the 40,000 KRW range have been prepared, so the launch of the ‘Untact Plan’ is expected to significantly reduce customers’ fee burdens.

Considering the Contactless Trend... Responding to Parliamentary Pressure for Fee Reduction

This plan is evaluated as meaningful in that the ‘Untact Plan’ strengthens customers’ choice regarding mobile communication service fees, considering the social trend emphasizing single-person households and contactless channels. This plan can be subscribed to at T Direct Shop when signing up for new service (including number portability) or device changes, and is also available for self-supplied (OMD) devices and SIM-only activations. However, it cannot be subscribed to for simple fee changes or used device changes of carrier-branded (OEM) devices.

The plan reported by SK Telecom on this day is the first case since the abolition of the fee approval system and the introduction of the reservation notification system on December 10 last year. This move also follows demands made during last year’s National Assembly audit for mobile carriers to launch affordable online plans by reducing marketing costs.

Especially amid the prolonged COVID-19 pandemic and the resulting economic downturn, it is significant that the leading company in the mobile communication industry is leading the reduction of 5G communication fees. Immediately after the plan was reported, National Assembly members Lee Won-wook, Jo Seung-rae, Woo Sang-ho, and Han Jun-ho unusually expressed their support, which is not unrelated to this. For SK Telecom, this move also considers political demands for reducing household communication fees and expanding consumer choice amid the spread of contactless trends.

The Ministry of Science and ICT approved SK Telecom’s LTE and 5G Untact Plan terms and conditions (fees and usage conditions) on the same day, stating, "It is targeted at online subscribers and reflects the recent trend of contactless services across society and the reduction of distribution costs, which was considered in the fee reduction."

◆ 5G Price Competition Intensifies... MVNO Wholesale Prices Also to Be Reduced

Accordingly, there are expectations that the release of low-cost 5G plans will accelerate. KT and LG Uplus are reportedly watching this first case since the introduction of the reservation notification system and are considering their own plan strategies. 5G, which has been criticized for being expensive, has surpassed 10 million subscribers.

Han Myung-jin, head of SK Telecom’s marketing group, said, “With the expansion of operators’ autonomy following the implementation of the reservation notification system, voluntary price competition in the industry is expected to intensify,” adding, “SK Telecom plans to continue launching various new plans based on customer needs and social trends.”

5G MVNO (Mobile Virtual Network Operator) fees are also expected to decrease further. The Ministry of Science and ICT, considering the potential negative impact of this 5G plan launch on the MVNO market, has instructed SK Telecom to reduce wholesale prices for MVNO operators. According to the Korea MVNO Association, the wholesale prices that MVNO companies pay to SK Telecom are about 89-96% of the corresponding plan prices, with almost no difference. The association argues that a 20% gap is necessary to secure MVNO competitiveness and maintain operating costs.

Additionally, the Ministry of Science and ICT has requested that additional reports be submitted promptly regarding the mid- and low-volume ranges of 5G plans. The ministry stated, "We hope that with the approval of these terms and conditions, the reservation notification system will activate the release of more diverse and affordable plans, leading to ongoing price competition and expanded consumer choice."

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