Government Draws Sword Against Telecom Market Oligopoly... Forms TF to Initiate Competition Promotion Discussions

Ministry of Science and ICT Prepares 'Measures to Promote Competition in the Telecommunications Market' for the First Half of the Year

[Asia Economy Reporter Oh Su-yeon] The government has launched a task force (TF) to fundamentally innovate the competition system in the telecommunications market, beyond diversifying plans such as senior plans and 40~100GB plans. The plan aims to reform the oligopoly structure of the three major telecom companies and significantly reduce household telecommunications expenses.

The Ministry of Science and ICT announced that it formed a task force (TF) to devise measures to promote competition in the telecommunications market as a follow-up to the Emergency Economic and Livelihood Meeting, and held the first meeting on the 20th.

At the kickoff meeting of the 'Telecommunications Market Competition Promotion Policy Task Force' held on the 20th, Park Yoon-kyu, the 2nd Vice Minister of the Ministry of Science and ICT (left), is speaking.
[Image source=Yonhap News]

On the 15th, President Yoon Seok-yeol instructed at the 13th Emergency Economic and Livelihood Meeting to prepare special measures to resolve the oligopoly in the telecommunications market and promote competition. The Ministry of Science and ICT formed the TF led by Vice Minister Park Yoon-kyu, including external experts from academia, related research institutes, and government officials.

Previously, through the Emergency Economic and Livelihood Meeting, the government announced plans to launch senior plans within March and diversify plans by segment and class, such as launching 40~100GB plans in the first half of the year, to expand users' choice of plans. To inject competition into the mobile telecommunications market and contribute to easing household telecommunications expenses, the government also plans to promote the activation of MVNOs, periodic disclosure of quality evaluations, and discovery of new 5G (28GHz) operators by the second half of the year.

Furthermore, the government defines the current oligopoly structure in the telecommunications market as a market failure and plans to fundamentally innovate the telecommunications market competition system through the TF. Vice Minister Park Yoon-kyu of the Ministry of Science and ICT pointed out, "Since the domestic telecommunications market formed an oligopoly structure centered on the three major telecom companies after mergers and acquisitions (M&A) among mobile carriers in 2002, the competitive structure centered on the three companies has been maintained for over 20 years. Recently, consecutive telecommunications failures, customer information leaks, and DDoS attack-related breaches show that the damage caused by market failure is directly borne by the public."

The government also reiterated its intention to allow the entry of a fourth mobile telecommunications operator. Vice Minister Park said, "The government’s efforts to create a competitive telecommunications environment have been somewhat insufficient so far. We will develop policy alternatives to make the telecommunications market more competitive, and this is not government market intervention but to ensure that market functions operate properly."

In the subsequent discussions, experts from various fields shared opinions on the current competition situation and issues in the telecommunications market and discussed tasks to improve market functions in the telecommunications industry sector. They reviewed institutional improvement measures to activate service competition such as easing barriers to entry for telecommunications businesses and enhancing MVNO competitiveness, as well as measures to ease frequency allocation and usage burdens.

Additionally, the Ministry of Science and ICT stated that while operating the TF, it will hold regular meetings to gather opinions from experts in various fields, industry, and consumer groups, and discuss the opinions and tasks identified in these meetings within the TF to prepare a ‘Telecommunications Market Competition Promotion Policy Plan’ by the first half of the year.

Vice Minister Park urged, “The government will break away from past practices to create fundamental policy alternatives to improve the competitive environment in the telecommunications market. I ask various experts to pool their wisdom and create bold and challenging policy alternatives with the sole goal of serving the public.”