South Korea's smartphone boom

Basharat Ashai/Maravedis
24 Feb 2011

Just a year and a half ago, smartphones were nearly absent from South Korea's wireless market, but a smartphone boom hit the country last year following Korea Telecom’s introduction of iPhones.

KT's move pushed other mobile operators like SK Telecom and LG U+ to raise their marketing spending and partner with smartphone manufacturers to try to claim a bigger chunk of the rapidly growing mobile data services market.

Smartphones had been a hard sell in South Korea due to their lavish price tags and the lack of apps, but now, with desirable devices such as the iPhone and Samsung Electronics' Galaxy S available at more reasonable prices, the country is on the cusp of a mobile Internet explosion.

The number of smartphone users jumped to approximately 7 million as of December 2010, up from 806,000 in December 2009 – a growth rate of 768.5%. The Korean smartphone market is growing rapidly, and manufacturers and mobile operators are pushing hard to introduce new smartphone models.

SK Telecom has made aggressive efforts in the smartphone sector recently by making a wider selection of smartphones available. Since losing customers to KT in Q1 2010, it fought back in Q2 2010, and the number of SKT smartphone users reached 3.91 million at the end of December 2010.

This represents 15.2% of its total mobile subscribers. SKT aims to raise this number up to 10 million by the end of 2011.

Galaxy S, the most popular smartphone (along with the iPhone) offered by SK Telecom, has sold more than 2 million units in South Korea since it debuted in June 2010.

LGU+’s smartphone subscribers rose to 420,000 at the end of November 2010 thanks to new models such as the Galaxy U and Optimus One. For LGU+ the portion of smartphone users among new activations increased from 8% in July 2010 to 36% in last November. LGU+ had rolled out seven smartphones as of November, and plans to roll out 14 smartphones this year.

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