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S. Korea to ease rules to allow 4th mobile carrier

South Korea will unveil a package of deregulation measures for the country's mobile network market to facilitate the entry of a new player and give existing carriers more leeway, the government said Thursday.

The local mobile market has long been dominated by three carriers -- SK Telecom Co., KT Corp. and LG Uplus Corp. The government turned down applications for a fourth player six times between 2010 and 2014.

"If a new business enters the market, it will spark competition, which will lead to a cut in subscription costs," the Ministry of Science, ICT and Future Planning said. "It will also contribute to the emerging segments, such as the Internet of Things and financial technologies."

To that end, the ministry said it will come up with measures to ease burdens for a new mobile carrier, including allowing the latecomer to gradually expand its nationwide coverage.

The ministry said it will receive applications for a fourth mobile operator in August and review the applicants from October to December.

Currently, about five companies, including Korea Mobile Internet, are believed to be jockeying for position to become the nation's fourth mobile carrier.

A new carrier is estimated to create an economic effect of 2.3 trillion won and generate up to 7,200 jobs, the ministry said, adding it will push to allow the fourth carrier to enter the market in 2017.

The ministry said it will also bolster the country's market for budget handsets operated by mobile virtual network operators, or mobile service providers that rent networks from the existing carriers.

As they save on network operation costs, MVNOs usually provide users with plans cheaper than those of the major carriers. A website will be opened to help customers find information on local MVNOs and their subscription plans.

The ministry said the MVNO-operated phones will take up 10 percent of the market by the end of this year and 12 percent in 2016.

As for the existing players, the ministry said it will abolish the so-called cost-permission system, which requires major mobile carriers to get prior government approval for changes in rates or the launch of new rate plans, a tool initially made to protect smaller firms.

Currently, SK Telecom and KT are subject to the systems in the mobile and fixed-line segments, respectively.

Instead, the major players will only be asked to report such plans to the government and will be allowed to make announcements 15 days later if they don't conflict with the public's and users' interests. (Yonhap)

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