The Ministry of Science and ICT promotes competition in the telecommunications market by actively supporting the entry of a fourth telecommunications operator and supporting the growth of budget phone operators.

The Ministry of Science and ICT announced on the 6th that it had released the 'Measures to Promote Competition in the Telecommunications Market' to ensure the sustainable development of the future telecommunications market and to alleviate the burden of telecommunications costs on the public.

The main points of this plan are △improvement of the competitive structure of the telecommunications market △enhancement of public benefits through the promotion of competition △revitalization of investment in wired and wireless telecommunications infrastructure.

The government will allocate 28GHz, 700MHz, and 1.8GHz frequency bands to new telecommunications operators and improve entry barriers. For budget mobile phone operators, it will make the mandatory wholesale provision system permanent and improve the method for calculating wholesale fees. Ultimately, to benefit users, it will also expand rate plan options, handset subsidies, and infrastructure investment.

■ Actively seeking new telecommunications operators

First of all, the government appears to have offered many incentives to support the entry of a fourth telecommunications operator. It allocates a dedicated frequency band of 28 GHz (for 3 years) and an anchor frequency band of 700 MHz or 1.8 GHz to the new operator. The anchor frequency will be determined through a public debate on the 11th.

The government subsequently proposed supplying 3.7GHz mid-low band frequencies to build a nationwide network. The frequency usage period will be set at 5 years, taking into account the easing of the burden of allocation fees and the 6G commercialization schedule (2028–3020).

The burden of initial market entry will also be significantly eased. It was stated that the burden of initial entry would be reduced by calculating the minimum competitive price to impose network construction obligations and by improving the payment method for allocation fees from the existing equal installments to incremental installments.

Upon market entry, the plan is to enable roaming on other companies' networks in areas where the company's network is not established, and to provide benefits such as policy financing, tax credits, and terminal distribution.

However, while the government is "sincere" about discovering a fourth mobile carrier—even pushing for institutional improvements to encourage foreign participation—the industry remains hesitant. This is because, with the three major carriers having already given up, choosing a difficult path that does not guarantee immediate profitability is not an easy decision.

An industry insider stated, “Small and medium-sized mobile carriers, unlike large corporations, inevitably face significant financial difficulties.” "Even if the initial burden is alleviated immediately, once the business starts and subscribers flock in, the scale of the business will grow and the cost burden will be continuous, so it must be viewed from a long-term perspective," he said.

■ Support for 'Competitive' Budget Phone Operators
Support measures for budget phone operators have also been prepared, just like for the fourth mobile carrier.

The government announced that, in order to enable budget mobile phone operators to grow by investing in facilities and other assets from a long-term perspective, it will make the mandatory wholesale provision system, which is currently set to expire due to the expiration of its validity period, permanent, and diversify the methods for calculating wholesale prices. In the future, plans are also being considered to expand the list of mandatory wholesale providers from the current SKT to the three major telecommunication companies.

In addition, discussions will be held regarding the reduction of wholesale prices for 5G plans for budget mobile carriers to encourage the launch of various 5G plans. Measures such as expanding discounts for bulk data pre-purchases and improving the image of budget mobile carriers will also be pursued.

Regulations on the aggregation of market share for the MVNOs of the three major mobile carriers' subsidiaries will also be improved. Currently, the market share of MVNO subsidiaries of mobile carriers is limited to no more than 50%, but accurate aggregation has been difficult because the calculation includes lines from automakers, etc. The government is considering a ban on exceeding a 50% market share, excluding finished vehicle lines.

This appears to be a partial solution to the claims made at the 'Forum to Seek Ways to Promote Rational Competition in the Telecommunications Market' hosted by Rep. Park Chan-dae last June, such as the reduction of 5G wholesale prices.

Park Sang-ho, a research director at the Public Media Research Institute, stated, “Fostering budget phone operators is less costly than introducing a fourth mobile carrier,” and proposed measures such as lowering wholesale prices for mid-to-low-priced 5G plans, extending and maintaining the mandatory period for budget phone operators, improving the method of calculating wholesale prices, and lowering radio wave usage fees. In the long term, he urged for institutional improvements centered on consumer choice through the fostering of 'Full MVNOs.'

This effectively lends some weight to the argument raised at the forum to foster Full MVNOs. The need to cultivate Full FVMO operators has been consistently raised to enable budget phone service providers to innovate technology services rather than limiting themselves to simple resale. Now, the key question is whether budget phone operators will show interest in investing in actual facilities from a long-term perspective.

■ Promoting Consumer-Centric Price Competition
Ultimately, the monopolization by the three major mobile carriers will be resolved, and users' choices regarding devices, rate plans, and operators will be expanded.

To this end, measures such as expanding user choice and supporting the selection of reasonable rate plans will be prepared. It is expected that the opinions of users, who have stated that 5G rate plans have been ineffective until now, will be reflected.

The three mobile carriers will improve the 5G rate system to be practical and suitable for usage patterns. Improvements will be made to allow users to freely choose LTE or 5G rate plans regardless of the device. Telecommunication companies will analyze users' usage patterns and notify individual users of the optimal rate plan twice a year.

The burden of communication costs for users will also be reduced. To alleviate the financial burden of purchasing handsets, the limit on additional handset subsidies from distribution networks will be raised from 15% to 30% of the official subsidy. Discussions will also be held with manufacturers regarding the launch of various mid-to-low-priced handsets. Early termination fees for the latter half of high-speed internet contracts will be significantly reduced, and the mobile phone selective contract discount system will be operated under a structure of 1 year plus 1 year instead of 2 years. In the future, consumers are expected to participate in telecommunication service quality evaluations and be able to utilize shared measurement data in various ways.

Finally, the government announced that it would revitalize investment in wired and wireless communication infrastructure. We are moving to secure core technologies in preparation for 5G infrastructure and 6G communication networks targeted for commercialization between 2028 and 2030.

This includes △rapidly establishing a nationwide 5G network by the first quarter of 2024 △expanding the use of the 28GHz band to subways, industrial (Eum 5G), and new companies △converting to 100% optical cables by 2026 △conducting research on 6G source technologies and developing commercialization technologies in parallel.

Minister Lee Jong-ho of the Ministry of Science and ICT stated, “The measures to promote competition in the telecommunications market serve as a roadmap for future telecommunications policy. They were prepared by reflecting the voices of experts from various fields to break away from the entrenched competition in the telecommunications market and fundamentally improve the competitive environment.” He added, “While there have been some initial achievements recently, such as the diversification of mid-range 5G pricing plans and the expansion of the budget phone market, we will not stop there. We will proceed with speed to fundamentally improve the competitive structure of the telecommunications market and revitalize competition across the entire market so that benefits can be returned to the public.”