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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: John Biddle who wrote (32097)	2/6/2003 5:49:58 PM
From: John Biddle	Respond to of 197246

Mobile firms to tackle new number policy By Yang Sung-jin Staff reporter 2003.02.07 koreaherald.co.kr As the Korean government moves to introduce a unified access code for mobile services and number portability, KTF and LG Telecom are taking preliminary steps to shield themselves from the potentially decisive impact of the new policies. Beginning in January 2004, mobile phone subscribers can receive or convert to a unified access code of 010 for third-generation (3G) service. Korea is currently offering cdma2000 1x service and is scheduled to offer competing 3G service known as W-CDMA in the second half of this year. Accordingly, mobile phone users signing up for 3G services next year will be given 010 for access code, regardless of service providers. SK Telecom's current access codes are 011 and 017, KTF operates 016 and 018, and LG Telecom uses 019. Existing 2G CDMA cellular phone subscribers will be allowed to change their access code into 010 starting from next year, something that SK Telecom fears will undermine its brand value, particularly concerning its "Speed 011." In addition, number portability will be applied to SK Telecom subscribers from January next year. Once subscribers purchase new handsets, they can switch to KTF and LG Telecom while keeping their 011 phone number. Number portability for KTF and LG Telecom will be applied in six-month intervals: KTF subscribers will be allowed to move to SK Telecom and LG Telecom from June next year, LG Telecom users will enjoy the same benefit from December. Although KTF and LG Telecom have enough time to flesh out their strategies, the two mobile carriers are keen to set the stage for better positions when the new policies are implemented next year. KTF and LG Telecom are particularly eager to attract customers from SK Telecom, the country's number one mobile carrier. Betters services and lower rates are likely to be introduced ahead of the new policies, analysts said. KTF officials said that the gradual introduction of number portability, which is now fiercely opposed by SK Telecom, has a variety of merits. But they appear worried about the reaction of customers. Mobile phone users' primary concern is quality and rate, and if competition gets ugly, KTF might suffer setbacks. Although official quality assessment data shows KTF is competing with SK Telecom on an equal footing, a majority of mobile phone users still favor SK Telecom and prefer its 011 brand. "It is a fact that all the three carriers have similar mobile service quality, but the customer perception is that SK Telecom's service is better than others," a telecom industry source said. KTF also considers introducing more competitive rate system. Back in August last year, LG Telecom launched what it calls "mini" rate, with the basic monthly subscription fee set at 6,000 won, the lowest among domestic mobile carriers. In other words, KTF mobile phone users might consider switching to SK Telecom for better quality or LG Telecom for lower rates. SK Telecom continues to stress its premium value of its service brand while LG Telecom puts emphasis on cheaper service fees. LG Telecom, meanwhile, is poised to attract new subscribers with one year to catch up. While its subscribers are blocked from switching to other carriers with their 019 number throughout 2004, LG Telecom will be allowed to sign up customers from SK Telecom and KTF, touting the merit of number portability. In short, SK Telecom and KTF subscribers can switch to LG Telecom services while maintaining their respective mobile phone number. LG Telecom, however, has not achieved a high penetration rate with regards to service quality and brand recognition, especially in comparison to other providers. Last year, LG Telecom staged an aggressive marketing drive, and invested heavily to upgrade the network infrastructure in an attempt to upstage its competitors. LG Telecom officials said that the upgrade efforts are paying off. The overall service and phone quality has improved, and a majority of customers now perceive its mini rate as one of the cheapest around. Meanwhile, SK Telecom continues to take issue with the government's plan to reshape the industry with number portability and a unified access code. It said the new policies would seriously undermine its brand value as it has invested heavily in establishing 011's brand name and brand recognition. Some critics argue that the sudden move by the ministry coincided with the transition of the government. Information and Communication Minister Lee Sang-chul, who worked as CEO for KT and KTF, is expected to resign once the Roh Moo-hyun government will be inaugurated Feb. 25.