5G subscribers surpass 6 million, but dissatisfaction is widespread.
Domestic 5G services are comprehensively ranked among the world's best.
We need to secure a solid revenue model and quality like LTE.


The number of domestic 5G subscribers surpassed 6 million just one year after commercialization. According to data released by the Ministry of Science and ICT on June 1st, the number of 5G subscribers as of April was exactly 6,339,917.

Complaints about 5G services are also on the rise. According to industry sources, on May 28th, an office worker surnamed Lim, who signed up for a KT 5G plan, received 1.3 million won in compensation from a KT agency through the Korea Communications Commission's Telecommunications Dispute Mediation Committee due to poor call quality.

KT drew the line, saying that it was personally responsible for the agency employee's failure to properly inform Mr. Lim about 5G coverage, and that there was no problem with its own 5G service. However, the fact that subscribers need to be aware of 5G coverage proves that 5G coverage is not yet complete.

However, domestic 5G services and coverage are not lagging behind global standards.

On May 20th, the UK-based OpenSignal released measurements showing that the 5G service speeds of Korea's three major mobile carriers were less than half that of Verizon in the US. From January to April of this year, OpenSignal measured the average 5G download speeds of 10 carriers in four countries with commercial 5G services: South Korea, the US, the UK, and Australia.

Verizon ranked first with 506.1 Mbps (megabits per second), followed by LG Uplus (238.7 Mbps), SK Telecom (220.6 Mbps), and KT (215.0 Mbps). Verizon uses the 28 GHz band, which is suitable for transmitting and receiving large amounts of data, while the three major domestic mobile carriers use the less-capable 3.5 GHz band.

Looking solely at download speeds, the three major domestic carriers are crushed. However, the 5G connection time is a different story. Verizon, ranked first in speed, had the lowest connection time at 0.5%, while T-Mobile, ranked tenth in speed, had the highest connection time at 19.8%. The three major domestic carriers also ranked second, third, and fourth in connection time. This is the result of the fact that 28GHz band 5G is at a disadvantage compared to 3.5GHz band 5G in terms of securing coverage.

When this was reported domestically, several media outlets raised concerns about reliability, pointing out that OpenSignal's 5G service speed and availability measurements were primarily conducted in the United States and not in Korea.

Given these results despite adverse conditions, the 5G service quality of Korea's three major mobile carriers can be considered among the highest in the world. However, this is merely a relative advantage, and unless they can improve 5G service quality to an absolute level, consumer dissatisfaction will persist.

◇ Full-scale introduction of 5G in the 28GHz band is still a long way off.

According to industry sources, the Ministry of Science and ICT is reportedly considering preemptively introducing 28GHz 5G, a full-fledged 5G band, to the public sector. This is because the three major mobile carriers and network equipment manufacturers are hesitant to commercialize the 28GHz band, citing a lack of viable revenue models.

Last March, the Ministry of Science and ICT requested the three major mobile carriers and SK Broadband to expedite their investment to preemptively block the economic downturn caused by COVID-19. In response, the four companies said they would increase their investment in the first half of the year from a tentative 2.7 trillion won to 4 trillion won.

However, contrary to the government's wishes, the situation for the three major mobile carriers is different. During its first-quarter earnings conference call, SK Telecom stated that commercialization within the year would be difficult due to the lack of a robust 5G service ecosystem in the 28 GHz band. Even if base station construction begins this year, commercialization is uncertain.

◇ 5G: The ecosystem will grow only when we instill the perception that it is a necessary service.

The 3.5GHz band 5G service ecosystem is also unable to escape this problem. The number of 5G subscribers exceeding 6 million is not due to a clear need for 5G, but rather to the fact that some of the latest smartphones are released exclusively as 5G models, and the three major mobile carriers have implemented strong subsidy policies to secure as many 5G subscribers as possible. The number of 5G subscribers for budget phones without subsidies barely exceeds 1,000.

Furthermore, the fact that 5G usage costs are higher than LTE, especially when consumers aren't convinced that 5G is superior to LTE, is also a hindrance to ecosystem expansion. The cheapest 5G plans from the three major mobile carriers are in the mid-50,000 won range, and even the cheapest plans from budget carriers are in the high 30,000 won range.

Launched in July 2011, LTE service surpassed 10 million subscribers within a year of commercialization, fueled by rapidly increasing demand for social media and OTT services. As of April 2020, the number of LTE service subscribers reached 55 million, exceeding the country's population (51.84 million).

For 5G services to escape the current discontent and uncertainty, we need to look back at the LTE example. It will become a necessary service and provide quality that satisfies consumers. Fulfilling these two propositions will be the driving force behind the growth of the 5G ecosystem. Relative advantage is merely a house of cards.