Local cell data is crazy expensive

Koreans pay 70 times more than Finns for smartphone data plans, according to a new report from a consulting firm, but some local telecom companies are disputing its findings.

Finnish consultancy Rewheel made this bold claim last Tuesday in a report titled “The state of 4G pricing” for the first half of 2018. The firm analyzed thousands of mobile service plans across 41 countries in the European Union and the Organisation for Economic Co-operation and Development (OECD).

The firm published comparisons of mobile data packages across countries calculated for different types of phone plans.

In one comparison, Rewheel analyzed the countrywide median per-gigabyte price for 4G smartphone plans that provided at least 1,000 minutes of airtime and a connection speed of 3 megabits per second or more for video streaming.

According to the findings, Korean telecoms charge customers 13.90 euros ($16.58) per gigabyte, the second highest among the 41 countries compared. The top-ranked country was not named.

Canada came in third at 9.60 euros, while the United States came in fifth with 7 euros.

According to Rewheel, Finnish service providers charged the least at 0.20 euros per gigabyte, or nearly one-seventieth Korean fees. A comparison of last week’s report and Rewheel’s report for the second half of 2017 showed that prices in Korea rose 0.50 euros in six months while Finland’s decreased by 0.10 euros.

France also didn’t charge much for mobile fees, with its median gigabyte price at 0.80 euros. The average for the 28 European Union countries was 2.30 euros, while the OECD average came to 2.90 euros.

In Rewheel’s study of the number of gigabytes included in 4G smartphone plans priced at 30 euros and equipped with 1,000 minutes in airtime and a connection speed of 3 megabits per second, Korean companies ranked near the bottom. At No. 39, they offered just 1 gigabyte for such a plan.

Companies in ten countries, including Finland, Denmark, the Netherlands and Switzerland, offered unlimited data for the 30 euro plan.

Korea’s mobile service providers find issue with Rewheel’s analysis. They criticized the consultancy for inaccurate research methods, arguing that the mobile plans surveyed were not the most popular packages in the country and that discounts were not taken into account.

“This is a casual comparison survey that doesn’t reflect the exact situation of individual countries,” said one spokesman for a large domestic service provider.

But others believe there are lessons that Korea can take away from the report.

“Though Rewheel’s findings are not absolute, we have also conducted research where we found that Korean mobile providers charge much more than other countries,” said Ahn Jin-gul, a manager at the People’s Livelihood Economy Research Institute. “French mobile providers offered 10 gigabytes for little over 20,000 won [$18.51].”

“Korea’s three mobile service giants, which together reap huge profits of 4 trillion won a year, must do something about their price-fixing and radically decrease their service charges,” he continued.

“They should create a supplementary mobile plan that offers more than 2 gigabytes for around 20,000 won or make their unlimited data prices much cheaper.”

BY BAE JAE-SUNG, KIM EUN-JIN [kim.eunjin1@joongang.co.kr]