KT and LG U+ buy into OneStore, the Google Play killer
As a result, the app market now has all of Korea’s three major telecommunications firms as shareholders, including SK Telecom, which already had 50 percent share.
The acquisition gives KT and LG U+ 3.1 percent and 0.7 percent stake each in the app’s operating company of the same name, the mobile carriers said Wednesday. Along with One Store’s largest shareholder, SK Telecom, Korea’s three mobile carriers now own a combined share of 53.9 percent in the company.
Among the rest, 26.3 percent belongs to Naver, while 19.4 percent is owned by financial investors.
In a joint statement, the mobile carriers said the strategic investment was based on a mutual agreement that it was time they jointly ramped up support to develop a “Korean app market in order to boost support for the domestic IT ecosystem.”
At the moment, One Store is the only domestic-made app market that can compete against Apple’s App Store and Google Play. According to research firm IGAWorks, One Store took 18.4 percent market share by payment volume in August 2020, while Google Play and Apple’s App Store accounted for 71 percent and 10.6 percent, respectively.
One Store was started in 2016, when SK Telecom, KT and LG U+ decided to combine their respective app markets into a single platform. Before that point, each mobile carrier operated a different app market for their network subscribers, downloaded as a default app on phones. Naver, which was operating its own app market, later joined the platform as well.
One Store is currently a subsidiary under SK Telecom, which had the largest number of users when the app markets were merged. In September last year, it launched procedures to go public on the local stock market.
“The two telecommunication companies have worked closely with us in the past five years as business partners,” said One Store CEO Lee Jae-hwan in a Wednesday statement. “We’re anticipating a higher level of cooperation as the two join as stakeholders.”
The strengthened alliance comes at a time as Korean politicians and local app publishers continue to voice criticism against foreign app market in-app payment policies.
Dominance of global app markets in Korea became an issue last year as Google said it would start charging 30 percent commissions on all in-app purchases from September 2021. At the moment, the fees are limited to mobile games. Local app publishers complained that Google was abusing market power after building up dominance with lower fees.
That also dragged Apple into spotlight, which had always imposed the 30 percent fee regardless of the service type.
Their crisis worked in favor of One Store. The app market’s transaction volume in 2020 jumped 34.4 percent on year. The company turned profit for the first time since the 2016 launch.
BY SONG KYOUNG-SON [firstname.lastname@example.org]