'Jumping Every 3 Months' Thrifty Mobile Users... Competition for High-Value Gifts

No Contract Period Makes Number Portability Easy
Switching Monthly to Match Promotions
Subsidiaries of the 3 Major Telecom Companies
Fueling Competition with Financial Power

[Asia Economy Reporter Cha Min-young] "I switch whenever a good budget phone promotion comes up, usually every 3 to 6 months."

As more consumers frequently switch their numbers to take advantage of budget phone promotions, fierce competition over high-value gifts targeting these users is intensifying. Due to the nature of budget phones having no contract period, there are even so-called "migratory users" who change mobile carriers every month.

According to industry sources on the 17th, SK Seven Mobile, a budget phone operator affiliated with SK Telecom, is offering a ‘Curble Chair Wider’ worth an online lowest price of 37,000 KRW as a gift for number portability events in February. The offer targets subscribers of certain LTE unlimited USIM plans and mid-tier USIM plans. Choosing the lowest-priced mid-tier USIM plan (1GB/100 minutes) at 5,500 KRW per month results in a benefit of over 30,000 KRW.

KT M Mobile, affiliated with KT, provides gifts such as Apple genuine chargers, multivitamins, tumblers, and convenience store gift certificates ranging from 10,000 to 30,000 KRW. LG Uplus’s U+ Budget Mobile offers red ginseng and expensive language course vouchers.

Recently, the gift competition in the budget phone market has been heating up mainly among budget phone operators affiliated with the three major carriers who have strong financial backing. With monthly changing promotions and a flood of various gifts, situations where the gift value exceeds the actual cost have become common. As a result, among consumers, the number of "cherry pickers" who open two or more USIM cards under the same name just to target specific gifts is increasing. The method of using a 2,200 KRW monthly LTE plan (500MB/100 minutes) through the ‘Budget Phone Hub’ has also been shared in online communities.

Number portability within the budget phone market is also increasing annually. According to the Ministry of Science and ICT, the number of customers switching within Mobile Virtual Network Operators (MVNOs) rose from 390,000 in 2017 to 470,000 last year. In January this year, it recorded an all-time high of 52,167 per month.

While this market competition activation is welcomed by the government and the overall market, small and medium-sized businesses cannot be entirely pleased. Ha Chang-jik, Secretary General of the Korea Budget Telecom Operators Association, said, "The market has grown so much that there are as many as 45 operators specializing in mobile communications among budget phone providers," adding, "As the number of businesses and the overall market size increase, marketing competition has also intensified." On the other hand, a representative of a small budget phone operator said, "Unlike the three major carriers’ affiliates, small companies with limited financial resources cannot even dream of acquiring new customers," and added, "We are not spending excessively on marketing."

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