Indirect Participation Instead of Direct Involvement
Focus on B2B Derived Demand Such as Cloud Construction
"Already Possess a Large Amount of Quality Data
Will Further Consider Obligations of Information Providers"
[Asia Economy Reporter Minyoung Cha] Ahead of the MyData (Personal Credit Information Management Service) era opening this August, the three major mobile carriers have also begun preparations. From the perspective of telecom companies, who are 'major data holders,' the incentives to participate directly are limited, so they are focusing more on derivative markets such as indirect participation through collaboration with financial companies and demand for cloud infrastructure.
According to industry sources on the 18th, the three telecom companies are maintaining their policy of indirectly entering the MyData business through collaboration with financial and fintech companies. SK Telecom is cooperating with Hana Financial Group, KT with Woori Financial Group and BankSalad, and LG Uplus with Shinhan Bank in ICT fields including MyData. This is the result of financial sectors, where MyData competition is fierce, sending love calls to telecom companies that have strengths in big data.
Among the three, only SK Telecom, the eldest sibling, has started preparing for MyData business licensing. LG Uplus is exploring additional potential MyData business operators besides Shinhan Bank. KT has made a 25 billion KRW equity investment in BankSalad, a leader in the MyData business, and formed a strategic alliance.
MyData is a new business based on the principle of the autonomous use of personal information. The right to request information transmission is key, and with free data mobility becoming possible, there is great anticipation that new markets such as related platforms will be developed.
In KT’s case, there is more interest in derivative markets than in the MyData business itself. In August last year, KT launched a ‘Financial MyData Package’ targeting financial and fintech companies wishing to enter the MyData business. It bundles financial-dedicated cloud infrastructure, big data analytics platforms, and financial API platforms.
The reason telecom companies are not directly participating is due to a lack of incentives. Since they hold a large amount of sensitive customer information, security issues follow. From the perspective of telecom companies, which have accumulated and processed high-quality data over decades, there is little reason to rush into MyData.
Policies aimed at improving convenience for the telecom industry, such as simplifying subscription procedures, are expected to be introduced centered around the Korea Association for ICT Promotion (KAIT). One likely measure is simplifying subscription procedures by receiving personal information with the consent of existing customers when subscribing to bundled products.
Professor Seungjoo Kim of Korea University Graduate School of Information Security said, "From the perspective of telecom companies, there may be more concerns about the level of data they should provide as information providers." He added, "Basic conditions such as data pseudonymization and de-identification issues, and the introduction of sandbox regulations must be well established for the MyData and data ecosystem to be properly built." The telecom companies are scheduled to be designated as mandatory information providers in early August.
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