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(LEAD) S. Korea fails to pick 4th mobile carrier

All News 15:53 January 29, 2016

(ATTN: RECASTS headline; ADDS details throughout)
By Kang Yoon-seung

SEOUL, Jan. 29 (Yonhap) -- South Korea's ICT ministry said Friday it did not select a winner for a license to operate the country's fourth mobile carrier, citing lack of qualifications.

In November, three candidates passed an initial government assessment in line with the ministry's plan to inject more competition into the market, which is currently dominated by three players -- SK Telecom Co., KT Corp. and LG Uplus Corp.

The Ministry of Science, ICT, and Future Planning said all three candidates failed to meet the minimum requirement during the assessment procedures conducted by a group of 16 experts.

The three contenders were Sejong Telecom Co., K Mobile and Quantum Mobile, while Korea Mobile Internet (KMI), whose past six bids were rejected by the government, did not hand in another application this time around.

While the candidates were required to receive at least a grade of 70, Quantum Mobile managed to get a 65.95, followed by Sejong Mobile with 61.99 and K Mobile with 59.64, the ministry said.

"All three firms lacked credibility and viability of their fund-raising plans, and they also lacked detailed plans on ways to establish networks and provide services," the ministry said.

This latest attempt marked the seventh time since October 2010 that Asia's fourth-largest economy tried to pick another mobile carrier.

Sejong Telecom Co. is currently a mobile virtual network operator (MVNO), which borrows networks from existing mobile carriers. The fourth mobile carrier differs from MVNOs as it operates its own networks. K Mobile was established by officials who left KMI.

The Quantum Mobile consortium is partnered with Solid Inc., which also took over South Korea's No. 3 smartphone maker Pantech Co. through a separate consortium.

SK Telecom currently dominates around 50 percent of South Korea's mobile network market, followed by KT with around 30 percent and LG Uplus with 20 percent.

Public demand for a fourth carrier has been escalating over the previous years with more users seeking cheap subscription plans.

Industry watchers, however, also say the urgency for another mobile carrier has weakened over the past few years amid the rise of MVNOs.

MVNOs refer to mobile service providers that rent networks from the country's three carriers. As this can reduce the cost of managing networks, the firms usually sell budget subscription plans through low-end smartphones.


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