The Korea Herald

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Regulators reject both bidders for fourth mobile operator

By Korea Herald

Published : Dec. 16, 2011 - 16:51

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KMI and IST fail to pass, clouding outlook over new impetus to wireless sector


The Korea Communications Commission said on Friday it would not issue wireless carrier licenses to Internet Space Time and its rival Korea Mobile Internet.

Both IST and KMI failed to secure 70 points or higher in the screening process, dimming their hopes to become the country’s fourth mobile carrier. Currently, the domestic market is dominated by SK Telecom, KT and LG Uplus.

The KCC held a judging committee meeting early Friday and gave 65.79 to KMI and 63.925 to IST. The full score is 100, and a successful candidate should get at least 70 to receive the license.

The judging committee members include experts in law, economics, finance and technology.

The KCC’s decision means the existing three carriers will be free from further competition.

Analysts and experts hoped that a fourth carrier would infuse fresh competition into the stagnant sector in terms of new service products and discounted pricing.

IST suffered largely because it lost one of its key investors. On Wednesday, Hyundai Group announced it would not put its money in the project led by IST, resulting in a sharply reduced assessment of the consortium’s financial capability.

IST, led by former Information Minister Yang Seung-taek, wanted to offer fourth-generation wireless services, but ended up losing its momentum due to the sudden departure of Hyundai Group.

KMI, which had attempted to grab a license after two unsuccessful bids, did not impress the government regulators over the shareholder makeup and business implementation plans.

As both applicants failed to get the license, the auction of the WiBro spectrum, slated for this month, will be canceled. KCC officials said it was time to check up on the policy on WiBro, a wireless network service that faces signs of slowing growth.

By Yang Sung-jin (insight@heraldcorp.com)