South Korean cellcos halve activation fees

Dylan Bushell-Embling
telecomasia.net

South Korea's mobile operators have all slashed registration fees for new customers by 50%, in the second government-mandated cut to the charges.

SK Telecom has reduced its sign-on charge to 10,800 won ($10.65), compared to 7,200 won for KT and 9,000 won for LG U+, the JoongAng Daily said.

SK Telecom has estimated that the move could lower customers' bills – and thus its billing revenue – by 70 billion won per year, while KT has estimated a 30 billion won impact.

At the urging of the government, South Korea's operators agreed last year to phase out subscription fees altogether by 2015. As part of the commitment, they reduced activation fees by 40% in 2013.

At the time, Korea's Ministry of Science, ICT and Future Planning estimated that doing away with the fees could reduce mobile charges for consumers by a total of 500 billion won a year.

Regulator KCC has meanwhile threatened to introduce even heavier fines for operators continuing to exceed the mandated cap on handset subsidies.

Last month, the regulator also said it is considering rules making it a requirement for operators to provide detailed information about the discounts and incentives offered to consumers as part of a mobile plan.

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