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2017-04-17 17:08
By Lee Min-hyung

A drastic reduction in households’ mobile telecom costs has been a major populist presidential pledge recurring every five years here when the elections take place.

The same is expected to continue for the upcoming presidential election, with the two front-running candidates ― Moon Jae-in of the Democratic Party of Korea (DPK) and Ahn Cheol-soo of the People’s Party ― seeking to win more votes with their own pledges to cut rising telecom costs.

But their mainstream telecom pledges are unlikely to turn into reality, as they are already meeting strong opposition from telecom operators and other interested parties.

Moon has promised to abolish the basic monthly telecom fee of 11,000 won ($9.64) and return the money to the elderly and economically vulnerable.

But concerns are rampant that the cost reduction will carry consequences for the overall telecom industry, as mobile carriers are highly likely to cut subsidies to make up for the loss. As a result, customers may have to buy new handsets at much higher prices.

According to Rep. Cho Bae-sook of the minority People’s Party, the nation’s three major mobile carriers ― SK Telecom, KT and LG Uplus ― will face deficits once the plan is implemented. Hence, the lawmaker calls any such pledge unrealistic.

Ahn also pledged to reduce the burden of the public’s mobile data use by introducing what he calls a “zero-rating” data-free system. He said the move comes amid surging data traffic with the arrival of the Fourth Industrial Revolution. The entrepreneur-turned-politician estimated global data traffic is expected to surge more than 2.5 times in 2019, compared to this year.

Toward that end, he also promised to install more than 50,000 free Wi-Fi stations across the country.

This sounds more realistic than Moon’s cost reduction pledge, as telecom operators will be able to theoretically offer free data services for all subscribers here without establishing additional base stations.

But this is also expected to raise the ire of the carriers, as long-term-evolution (LTE) wireless services are their major revenue sources. As text messaging has become a de facto free service in recent years, some experts say data use may also be freely accessible sometime later. But this is unlikely to become a reality at least during the upcoming administration, as data for wireless network services gets more and more important with the arrival of the fifth-generation (5G) network in 2020.

Mobile carriers voice their consensus that they need to make massive investments ahead of the 5G era, and a free data pledge will come at severe costs to their businesses.

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