[2021 National Audit] Woo Sang-ho: "Mobile Carriers' MVNO Affiliates Should Be Phased Out"

[Image source=Yonhap News]

[Asia Economy Reporter Eunmo Koo] There has been a call to gradually withdraw the budget phone providers affiliated with the three major mobile carriers.

At the comprehensive audit of the Ministry of Science and ICT held on the 20th by the Science, Technology, Information and Communications Committee (STICC) of the National Assembly, Woo Sang-ho, a member of the Democratic Party of Korea, pointed out, “To create a proper competitive system in the mobile telecommunications market, the budget phones affiliated with the three major carriers should be phased out.”

On that day, Rep. Woo said, “The combined operating profit of the three major carriers increased from an average of 3.07 trillion won between 2015 and 2020 to over 3 trillion won as of the third quarter this year, and operating profits are expected to reach the 4 trillion won level by the end of the year,” adding, “If excessive operating profits are being earned from businesses using public goods, intervention is necessary.”

He also stated, “Currently, the domestic mobile telecommunications market is solidified into an oligopoly with a 5-3-2 market share (in order: SK Telecom, KT, LG Uplus),” and “Although the budget phone market was intended to implement a competitive pricing system, the reality is that a significant portion of the budget phone market is occupied by the three major carriers.”

Rep. Woo emphasized the need to change the three-year sunset clause on wholesale prices into a mandatory system to create an environment where budget phone providers not affiliated with the carriers can invest. He said, “When I asked pure budget phone providers not tied to the carriers why they do not invest, they answered that it was because of the three-year sunset clause on wholesale prices.”

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