LG U+ launches truly unlimited data plan

LG U+ has rolled out a new phone plan that gives unlimited data without compromising on data transmission speeds, heralding a fierce competition between rival carriers already suffering from the government’s push to lower household phone bills.

According to LG U+ on Thursday, it is launching a new phone plan that offers unlimited long term evolution data without slowing down data transfer speeds for 88,000 won ($81) per month. The phone plan also enables subscribers to share 40 gigabytes of data per month with family members and friends, taking some of the pressure off household phone bills, according to the carrier. The phone plan is available from today.

While there are already phone plans that claim to offer unlimited data from SK Telecom, KT and LG U+, none of them actually offer unlimited data at full transfer speeds due to concerns over excessive data traffic slowing down or crashing service networks.

Customers using these services still have access to data, but when they pass a certain monthly download rate determined by their package the network switches to 3G.

LG U+, however, is now the first carrier to release a plan that offers truly unlimited data at top download speeds. The company said it has completed all simulations and is ready for a potentially huge hike in its data traffic.

Whether rivals SK Telecom and KT will launch similar phone plans is not yet clear, but LG U+ expects that the new launch will trigger competition for truly unlimited data plans.

As LG U+ is currently the smallest carrier among the three, the new launch could help it attract more tech-savvy consumers hungry for high-speed data. SK Telecom and KT may need to offer some sort of alternative to stop LG U+ growing its market share.

According to LG U+, its average subscriber consumes 7.5 gigabytes of data per month, a 17.2 percent increase year on year. This year, average customers are expected to use more than 8 gigabytes of data per month.

Industry analysts say the mobile carrier has been pushed by a recent government initiative to lower household phone bills.

The Moon Jae-in administration has been emphasizing the need for telecom companies to come up with cheaper phone bill options that make data more accessible to consumers, but telecom companies have been trying to avoid criticism by revising the terms of existing phone plans and adding benefits rather than lowering prices.

“It is difficult for any mobile carrier to start a price war with phone plans as carriers have already been suffering [losses] after the discount ceiling on monthly phone bills was raised to 25 percent [from 20 percent] last year,” Hwang Hyeon-sik, senior vice president at LG U+, said at a press briefing held at the company’s headquarters in Yongsan District, central Seoul, on Thursday. “Our business direction for the time being is to select a concrete target for our phone plans and offer the best service options possible.”

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]