KT defeats competitors in subscriber revenues

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KT defeats competitors in subscriber revenues

KT, the nation’s No. 2 mobile carrier, said it achieved an outstanding performance in its wireless business in 2014 as a result of its aggressive responses to the market during Chairman Hwang Chang-gyu’s first year leading the company.

According to data released by the country’s three mobile carriers last week, KT’s average revenue per user (ARPU) increased 9.7 percent year-on-year, while its number of wireless subscribers also grew for the first time in three years.

ARPU is the leading index for determining the profitability of mobile carriers.

KT attributed this to its quick response in keeping up with the changes in market trends. The company made aggressive moves in increasing the amount of official subsidies on smartphones, lowering their launch prices and creating cheaper monthly plans.

The average revenue per user at KT increased to 35,283 won ($32) in 2014 from 32,160 won in 2013, outnumbering competitors SK Telecom, which posted a 2.9 percent increase in ARPU to 36,673 won from 35,650 won, and LG U+, which saw a 5.8 percent rise to 37,558 won from 35,388 won.

KT gained a higher ARPU growth rate than its competitors as it attracted customers that use higher priced monthly plans, which are mostly on the LTE network. Subscribers to these plans also use more data than previous users of 2G and 3G phones.

Last year, KT had 10.8 million LTE users, up 37.3 percent from 7.8 million in 2013, while SK Telecom saw 24.1 percent growth in its LTE users from 13.4 million to 16.7 million. LG U+ gained 18.3 percent more users year-on-year, rising to 8.4 million from 7 million.

“Considering that KT started its LTE service around six months later than SK Telecom and LG U+, the figures for ARPU and the subscribers are worth noting,” said a spokesman for KT. “Although the spread of LTE service is slowing down, the amount of data usage is still increasing, so we expect the ARPU to continue to rise.”

It also said it is planning to expand its number of LTE customers to 75 percent of all its users while raising its ARPU growth rate - which is how it makes most of its profits - to at least 4 percent year-on-year at the end of 2015.

Its number of wireless subscribers also increased 5.3 percent year-on-year last year to 17.3 million users. The sum fell every year between 2011 and 2013.

The company’s growth rate is also higher than that of SK Telecom’s 4.6 percent and LG U+’s 3.6 percent.

BY KIM JUNG-YOON [kjy@joongang.co.kr]
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