KCC gunning to ax subscription fees for mobile phone users

The Korea Communications Commission plans to abolish subscription fees for mobile phones to facilitate lower telecommunications costs, sources said yesterday.

In Korea, all new subscribers must pay an initial fee of between 24,000 won ($23) and 40,000 won.

The KCC is expected to unveil details in its 2013 policy briefing to President-elect Park Geun-hye’s transition team next Wednesday. Government ministries are set to begin putting new policies together today, and the new administration will officially be inaugurated on Feb. 25.

“We will brief the transition committee about policies that could back up Park’s election pledges on broadcasting and telecommunications after thoroughly examining Park’s manifestos,” said an official at the national regulator. He said the KCC will soon start discussions with mobile carriers about abolishing membership fees.

It will also urge carriers to introduce a wider range of calling plans that specialize in giving more data use better tailored to subscribers’ lifestyles. Consumers have complained that current plans still fall short of expectations.

The KCC will encourage non-conventional mobile phone businesses to introduce more altteul, or “thrifty,” phone services that run in partnership with mobile virtual network operators (MVNOs).

MVNOs borrow networks and communication frequencies from established telecom companies. This enables them to offer subscribers cheaper payment plans centered on basic calling services.

The KCC aims to further lower prices of calling plans for altteul phones by encouraging competition in the MVNO businesses. It said there are 1.15 million altteul phone subscribers. Additionally, the KCC wants to improve distribution channels and cut handset prices by introducing more phones that can be used with the altteul service.

The KCC also said it plans to grow the prepaid mobile phone market. According to statistics issued by the KCC, 1.53 million people subscribed to prepaid mobile phones as of November, up 50 percent on-year.

“This is remarkable given that there were only 580,000 subscribers back in 2009,” said another official at the KCC, which aims to brief Park’s team on how to add 30,000 jobs in the broadcasting and communications sector by 2014.

By Kim Mi-ju [mijukim@joongang.co.kr]

By Kim Mi-ju