Minister of Science and ICT Yoo Sang-im speaks during a meeting with telecom CEOs held at the Korea Chamber of Commerce and Industry in central Seoul on the 13th. (Yonhap)

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The South Korean government has formally urged the country’s three major telecom operators - SK telecom, KT, and LG Uplus - to increase competition in their service offerings and pricing to help alleviate household financial burdens. During a closed meeting on Wednesday with the telecom CEOs, Science and ICT Minister Yoo Sang-im expressed concerns over the entrenched oligopoly in the telecom market and its effect on pricing. One outcome of the meeting was an agreement among the companies to stop offering new subscriptions for LTE plans that are now more expensive than 5G by the end of 2024, with current subscribers able to retain their plans until they choose to switch or cancel.

Industry analysts noted the unprecedented nature of Yoo’s direct address to telecom leaders regarding market concentration. The minister criticized the companies for relying on the oligopolistic structure without fostering meaningful service and price competition. He outlined pressing industry issues, such as lowering consumer costs, promoting competition, curbing illegal spam, supporting small businesses, and advancing investments in AI. “Reinvigorating competition is a key task of our time,” Yoo emphasized during the meeting.

In response, the telecom companies pledged to enhance consumer-friendly services and address the recent price reversal, where LTE plans have become more expensive than some 5G offerings. KT announced a new integrated 5G-LTE plan to debut in the first quarter of 2025, while SK telecom and LG Uplus plan similar options once their billing systems are updated.

Discussions also extended to the affordable mobile market, which was designed to lower costs for consumers but has been increasingly controlled by the three telecom giants’ subsidiaries. The companies agreed to consider reforms to address monopolistic tendencies in this market.

To tackle illegal spam, SK telecom CEO Ryu Young-sang revealed a company-wide task force, with KT and LG Uplus committing to similar efforts. Addressing support for small businesses, KT CEO Kim Young-shub announced a new department dedicated to aiding small businesses while other telecom companies signaled plans for comparable initiatives.