The Korea Communications Commission unveiled support measures Monday for mobile virtual network operators so that they can release telecom services that are 20 percent cheaper than what is now available.
The state telecom regulator said SK Telecom, the country’s top mobile carrier, will provide the MVNOs with mobile phones until June 2012.
It also said SKT will also help the MVNOs, which plan to launch their services beginning in July, offer 15 supplementary services like video calls, multimedia messaging and the caller identification blocking services.
“Such details are an outcome that was agreed upon by the commission’s MVNO task force, which was created on April 4, and it is expected to add speed to officially providing MVNO services as agreements are soon to be reached by the service operators and its partners,” said a KCC official.
MVNO’s partners, such as SKT, will assist in establishing the necessary facilities for the new network operators and operators would have until the end of 2012 to pay off all costs, KCC officials said.
The KCC’s move is expected to not only to lower the market entry barrier for firms but also increase competition among the telecom industry, which is currently dominated by three mobile carriers ― SKT, KT Corp. and LG Uplus.
Currently, small- and mid-sized firms like the Korea Cable Telecom, SK telink, Eyesvision and Onse Telecom have expressed interest in positioning themselves as MVNOs.
A MVNO is a firm that offers mobile phone services at a cheaper price to consumers by lending the needed infrastructure from other telecoms. As an exemplary case, a MVNO does not have its own licensed frequency allocation of radio spectrum or all infrastructures required to give telecom services.
With the service introduction, people could opt to go with the 20 percent cheaper telecom scheme. MVNO would also be able to try out more experimental projects and applications, those that could not be easily tested by the nation’s telecom firms.
“It may become a win-win strategy for both MVNOs and telecom companies since MVNOs may be able to target the niche market, such as the senior silver market and the market specializing in games, whereas telecom firms have to provide a greater range of general services,” said a KT official. The official, however, added that the quality of the MVNO’s service may not meet consumers’ expectations.
By Cho Ji-hyun (email@example.com