Mobile handset subsidies to be revived from March

The government will lift its ban on mobile handset subsidies from March, allowing subscribers who have maintained the same service provider for at least 18 months to buy new handsets at bargain prices. Service providers will be able to offer the benefit to qualifying subscribers once every two years. The deal was reached by the information and communications committee of the National Assembly yesterday, and is effective until Mar. 27, 2008. The upshot is that six out of 10 mobile phone subscribers nationwide will be able to buy handsets for about 10 percent cheaper than current prices. An earlier proposal by the Ministry of Information and Communications would have made the benefit available only to subscribers who stuck with the same service provider for at least two years. Of Korea’s 38 million mobile phone subscribers, 52 percent (20 million) have maintained accounts for over two years, while 64 percent (24 million) have maintained accounts for at least 18 months. By service operator, SK Telecom Co. will have around 70 percent of its subscribers benefit from the new subsidy system, while KTF Co. and LG Telecom Inc. will have 56 percent and 51 percent of subscribers benefit, respectively. Users of portable digital assistants with telephony functions and handsets enabled for digital multimedia broadcasting (DMB) reception must also have maintained accounts for at least 18 months to qualify for subsidies. Meanwhile, the committee will also allow mobile service providers to offer up to 40 percent discounts to new subscribers of next-generation mobile communication services such as WiBro, or Wireless Broadband Internet, regardless of how long they have been subscribers to a particular company. “The number of mobile service subscribers to be subsidized has grown much more than we planned,” noted an Information Ministry official. “Mobile carriers will decide the percentage of mobile subsidies on their own and the plans will be based on their service policies.” by Seo Ji-eun, Lee Weon-ho