LG Uplus Strengthens 'Win-Win Strategy' for Small and Medium MVNOs

'U+ Altteul Phone Partners' 2.0 Revamp

[Asia Economy Reporter Eunmo Koo] LG Uplus is strengthening cooperation with MVNO operators using its network. The company aims to break free from being the perennial third place in the MVNO market, which is steadily approaching 10 million subscribers, and seize the leadership position. It plans to enhance the competitiveness of its plans by providing free data, expand LG Uplus stores accessible to MVNO customers, and reduce wholesale network fees to ease the cost burden on operators.

‘Second Place in MVNO’ LG Uplus Continues Upward Momentum

On the 3rd, LG Uplus held an online press briefing and announced ‘U+ MVNO Partners 2.0,’ a program to strengthen mutual growth with small and medium MVNO operators using its network. This revision is a follow-up support plan to the ‘U+ MVNO Partners 1.0’ program launched in September 2019.

As the U+ MVNO Partners program, initiated to strengthen the MVNO business, has proven effective, the number of participating companies increased from 20 to 26 in just over a year, with cumulative subscribers growing by 192% and monthly new subscriptions by 200%. Recently, LG Uplus surpassed SK Telecom for the first time to take second place in the MVNO market. According to the Ministry of Science and ICT, as of the end of April, about 2.23 million MVNO subscribers use LG Uplus’s network, an increase of nearly 80,000 from March, surpassing SK Telecom’s 2.19 million subscribers.

LG Uplus plans to continue its market share growth by expanding and strengthening support for participating companies through this revision. To this end, it will enhance the competitiveness of operators. First, it will lower wholesale network fees, the biggest concern for small MVNO operators, to the industry’s lowest level. Earlier this year, LG Uplus reduced wholesale rates for some data plans by up to 8% compared to last year and lowered the wholesale rate for pay-per-use voice calls by 41% year-on-year.

LG Uplus will also expand device support on behalf of MVNO operators who lack bargaining power with device manufacturers and distributors. Beyond supporting device supply through existing used phone distributors, LG Uplus will supply long-term inventory devices at used prices to operators and sell unlocked devices at affordable prices through the U+ Partners exclusive unlocked device mall. It will launch a ‘shared SIM’ usable by all participating companies and promote joint marketing with small operators lacking marketing funds.

Additionally, LG Uplus will expand customer service (CS) stores where customers who activate MVNO services through partners can visit nationwide LG Uplus direct and retail stores for inquiries and consultations from about 190 to over 500 stores, with plans to consider expanding to 2,000 stores later. Self-activation will also be expanded. Currently, only five MVNOs among partners support self-activation, but this will increase to 12 by the end of the year. Increasing self-activation will improve convenience by enabling immediate activation for customers and reduce labor and logistics costs for operators.

Strengthening Plan Competitiveness

LG Uplus’s renewed effort to strengthen cooperation with MVNO companies is also related to the stagnating mobile telecommunications market. Domestic mobile carriers face saturation in subscribers, resulting in sluggish growth. However, MVNOs continue to grow steadily as consumers increasingly prioritize cost-effectiveness. According to the Korea Telecommunications Operators Association, in May, MVNO number portability reached 56,056 cases, marking 12 consecutive months of subscriber gains from the three major carriers.

To actively respond to these market changes, LG Uplus is also enhancing the competitiveness of its plans. First, to support small MVNO operators focused on prepaid subscribers in expanding postpaid subscribers, it will provide free data. LG Uplus will offer up to 150GB of data per month for 24 months at no additional cost to existing and new subscribers of partner companies. There are four plans with free data, providing 150GB, 50GB, or 10GB depending on the plan. MVNO operators can launch aggressive plans featuring additional data to attract subscribers and reduce churn among existing customers.

In partnership with KB Kookmin Card, LG Uplus will also introduce a discount card exclusively for MVNOs. Customers who issue the ‘KB MVNO HUB2 Card’ and subscribe to unlimited data plans sold by partners can receive discounts of up to KRW 29,900 per month for 24 months. Additionally, LG Uplus will launch a ‘membership product’ in collaboration with Naver Pay, GS25, and Olive Young, offering discounts worth a total of KRW 120,000 over two years.

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