Domestic Value-Added Telecommunications Service Revenue Approaches 200 Trillion Won and Employment Nears 410,000

First Analysis of Market Composition and Value-Added Communication Market Size
Digital Platform Companies Account for One-Quarter of All Value-Added Communication Providers
Digital Platform Companies Represent Half of Value-Added Communication Revenue

[Asia Economy Reporter Lim Hye-seon] Last year, the sales revenue of value-added telecommunications service providers in South Korea reached 200 trillion won, with employment nearing 410,000 people. This accounts for about one-quarter of the total sales revenue of value-added telecommunications providers, which was 802.8 trillion won.

The Ministry of Science and ICT disclosed on the 8th the results of the first survey conducted over three months starting from September last year, targeting 4,352 value-added telecommunications providers with capital of 100 million won or more. This is the first survey aimed at analyzing the changing value-added telecommunications market and preparing policies to revitalize the market.

63% of All Online Direct Transaction Providers

Based on each company's representative service, business types were classified into intermediary platforms, platform infrastructure, online direct transactions, and telecommunications infrastructure. Online direct transaction providers numbered 2,750, accounting for 63.2% of the total. This was followed by telecommunications infrastructure with 750 providers (17.2%), intermediary platforms with 407 providers (9.4%), and platform infrastructure providers with 383 (8.8%).

The total domestic sales revenue of value-added telecommunications providers was 802.8 trillion won, of which value-added telecommunications service sales were estimated at about 199 trillion won.

The number of active users (3-month average users) was 13.5% higher for large enterprise services than for small and medium-sized enterprise (SME) services. The number of active users for large enterprises, mid-sized enterprises, and SMEs were 3.89 million, 905,000, and 289,000 respectively.

The total number of employees in value-added telecommunications providers was approximately 410,000 (94 employees per company), and the average number of desired hires per company was about 9.5.

Number of Digital Platform Companies, One-Quarter of Total Value-Added Telecommunications Providers

The Ministry of Science and ICT reclassified companies providing intermediary platform or platform infrastructure services among value-added telecommunications companies as digital platform companies based on the services they offer.

The number of digital platform companies was about one-quarter of the total value-added telecommunications providers (1,078 out of 4,352 companies), with SMEs accounting for 66.7%, which is lower compared to all industries (SME ratio 90%) and value-added telecommunications providers (SME ratio 82%).

The total sales revenue of platform companies operating domestically was 378 trillion won, accounting for half of the total value-added telecommunications sales. Value-added telecommunications service sales were estimated at 101 trillion won, and digital platform service sales at about 69 trillion won. Among these, only 2.7% of domestic platform companies actually generate overseas sales.

The number of active users for large enterprises was 8.5 times higher than that for SMEs. The active users for large enterprises, mid-sized enterprises, and SMEs were 5.01 million, 1.45 million, and 59,000 respectively. The total number of employees in domestic digital platforms was about 154,000 (143 employees per company), and companies expressed an average desire to hire an additional 24.7 employees per company.

The Ministry of Science and ICT has laid the foundation for detailed policy implementation by classifying the expanding types of the value-added telecommunications market and preparing market data through this survey. Going forward, related policy research such as studies on the characteristics of digital platforms by type will be conducted in parallel to systematically analyze the current status and characteristics of the domestic value-added telecommunications market.

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