"Contract Expiration and Plan Diversification" Increase in 5G Subscribers of Budget Phones

[Image source=Yonhap News]

[Asia Economy Reporter Eunmo Koo] As 5G commercialization surpasses two years and 5G subscribers who have fulfilled their contracts are returning to the market, the government's policy to promote 5G budget phones has led to an increase in consumers seeking 5G budget phone plans.

According to the wireless communication service statistics released by the Ministry of Science and ICT on the 5th, as of the end of May, the number of subscribers to 5G budget phone plans was recorded at 36,949. Compared to April (7,676), this is about a fivefold increase in just one month. Considering that budget phone providers first launched 5G plans in November 2019 and only surpassed 1,000 subscribers in April last year, this represents a rapid growth trend.

The recent increase in 5G budget phone subscribers is interpreted as the initial subscribers, whose contracts ended after two years since 5G commercialization in April 2019, have started to return to the market. As opinions spread that 5G service satisfaction is lower compared to expensive plans, subscribers who have fulfilled their contracts are either returning to cheaper LTE or moving to 5G services offered by budget phone providers with relatively lower prices. The overall increase in 5G subscribers has also been declining, from 1.02 million in January to 790,000 in February, 810,000 in March, and 670,000 in April.

Additionally, the effect of the government's budget phone support measures announced in April seems to be reflected. Previously, the government lowered wholesale network fees to activate 5G budget phones and allowed budget phone providers to independently design mid- to low-priced 5G plans. As a result, a series of low-cost plans not offered by mobile carriers have been launched. Starting this month, budget phone providers affiliated with the three major mobile carriers can also launch independent 5G plans, so the increase in 5G budget phone subscribers is expected to continue.

Meanwhile, the total number of budget phone subscribers steadily increased. In May, the total number of budget phone subscribers was recorded at 9,569,442, about 120,000 more than April (9,457,100). Since surpassing 9 million subscribers in December last year, the number of budget phone subscribers has been increasing by about 100,000 each month, making it highly likely to exceed 10 million within the year.

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