KT to ax 2G service on Jan. 3 after court agrees

A pedestrian walks past an advertisement for KT’s long-term evolution service on a KT branch in central Seoul yesterday. After nine months of debate over ending 2G service, KT is finally joining the fray to start 4G in Seoul on Jan. 3, the company said yesterday. [YONHAP]

A Korean court has authorized KT to pull the plug on its second-generation (2G) mobile communications service, wrapping up a complicated saga that began last month.

The Seoul High Court yesterday dismissed the request by 900 subscribers of KT’s 2G service who were hoping to stop the nation’s No. 2 mobile carrier from shutting down the service.

With this, KT plans to end its 2G service and start its fourth-generation (4G) service next Tuesday.

KT originally planned to end the aging service on Dec. 7 so it could jump on the faster 4G long-term evolution (LTE) bandwagon and not get left behind by market rivals who have already raced to adopt the new technology - before a class-action suit threw a temporary spanner in the works.

In justifying his decision, Seoul High Court Judge Sung Baek-hyun said that “the users’ demand could hinder the efficient use of radio-wave resources, which are deemed public goods.”

KT has been claiming that a far higher number of users would benefit from its services if the 2G technology makes way for the popular new LTE service, a type of 4G technology that carriers worldwide are now investing in.

“There are concerns that delaying KT’s entry into the 4G sector could hurt consumers’ welfare by solidifying the oligopoly that exists between [rival carriers] SK Telecom and LG U+,” Sung said.

Yesterday’s decision effectively reversed a lower court ruling that sided with the 2G users.

The group of KT 2G users filed a class-action suit against the Korea Communications Commission (KCC) on Nov. 30 for approving KT’s plan to ax the network, arguing that the carrier used “illegal means” to reduce its 2G users and that the regulator turned a blind eye to this. KT was required by law to scale back its 2G users before being eligible to make the switch.

The Seoul Administrative Court issued a preliminary injunction on Dec. 7, temporarily preventing KT from ending its 2G service, which nullified the KCC’s approval until the case went to trial. This came as a blow to KT as it had planned to sever ties with 2G that night, just hours after the ruling was made.

“The public has now lost confidence in KT,” Choi Soo-jin, the lawyer representing the plaintiffs, told the Korea JoongAng Daily at the time. “KT may succeed with its 4G service and achieve a technological edge over its rivals, which could attract new users. But they will not be as loyal as before.”

Unsurprisingly, KT welcomed yesterday’s ruling and vowed to join the 4G rush next week.

“[The ruling] allows KT to make more efficient use of its networks, which are considered national assets, and invest in next-generation network technology so it can provide a higher-quality service to customers and contribute to the development of the country’s IT industry,” the company said in a statement.

KT said it will end its 2G service from 10 a.m. on Jan. 3 in stages and help its 2G customers make a smooth transition to its next-generation service through various measures, such as by paying visits to their homes to talk them through the process.

The company also announced that it will launch its LTE service the same day. SK Telecom and LG U+ - the country’s No.1 and No.3 carriers - already launched the service in July, giving KT some catching up to do.

In recent years, KT has also invested heavily in WiBro (wireless broadband), a different type of 4G technology that was developed by it and other Korean firms and has been heavily promoted by the government. Unlike SK Telecom and LG U+, which are focusing their respective 4G commitments exclusively on LTE, KT said it will continue developing WiBro.

The latest news gives KT the green light to pursue a goal it has been chasing for over six months. The KCC rejected two earlier requests by the carrier to cancel 2G service in April and July.

By Kim Hyung-eun [hkim@joongang.co.kr]