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(Nikkei BP Group)

(No.1 High-Tech News Site in Japanese)

  • Korean Wireless Subscribers Drop Pagers For Cellular Phones
  • August 3, 1998 (SEOUL) -- Korea's wireless subscribers are giving up pagers for mobile phones including personal communication service (PCS) terminals, and more people are going online.
    A survey by the Ministry of Information and Communication found that the number of subscribers to the country's five cellular providers reached 10.18 million at the end of June, up 4.4 percent from a month earlier. The five cellular providers are SK Telecom Co., Shinsegi Telecomm Inc., Korea Freetel, LG Telecom Co. and Hansol Telecom Co.

    The number of fixed-line subscriptions slipped 0.3 percent to 20.21 million circuits between May and June with many corporate customers canceling their subscriptions due to bankruptcies. The two largest fixed-line carriers -- Korea Telecom and Dacom Corp. -- have seen their revenues shrink in recent months.

    The popularity of Internet telephony, which makes international calls more than 50 percent less expensive, is also eating away at their revenues. On the other hand, cancellations of paging services continued to accelerate, apparently marking an end to the boom in the paging industry, the ministry said.

    The number of paging subscriptions fell 3.3 percent to 13.11 million in June from a month earlier. In the first half of this year, 4.67 million cancellations were reported, compared with 5.14 million in all of 1997.

    Some 33 percent of pager users who canceled their subscriptions shifted to mobile phones.

    "There has been a change in the pattern of demand for paging services with the increasing popularity of mobile phones," a ministry official said.

    The slump in fixed-line and paging businesses is adding fuel to the ongoing industry restructuring. Job cuts and downsizing have become routine for the companies involved.

    As of the end of June, SK Telecom held 50.5 percent of the mobile telecom market, including nearly 1 million subscribers to its analog cellular services, followed by Shinsegi Telecomm with 15.1 percent. The three other digital providers account for the remaining 34.4 percent.

    The future is also uncertain for the cellular sector. Competition is intense in the mobile phone industry with the four latecomers struggling to generate profits. Cash-flow situations are becoming increasingly tight as they are boosting efforts to lure foreign equity partners.

    The increasing popularity of multimedia online services with access to the Internet contributed to a 2.8 percent monthly rise in the number of paying subscribers to the country's dozen-plus online services to 3.85 million. Dacom Corp. held the top share of 32.4 percent, despite strong competition in the online service industry.

    Among the findings of the ministry's survey was that some 60 percent to 70 percent of subscribers to wireless and online services are in their 20s and 30s. About two thirds of those subscribers are male.

    A separate survey conducted by Yahoo! Korea Inc. in May found that the gender gap is more pronounced among Internet users, with some 84 percent of them male. A total of 86 percent said they use the Internet to obtain news and information. Electronic commerce on the Internet is just beginning to catch on with only 18 percent of Internet users surveyed having purchased goods over the Internet.

    Related story:
    Internet Phone Use Rising Sharply in Korea
    Number of Pager Subscribers Declines in Korea

    (James Lim, Asia BizTech Correspondent)

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    Updated: Fri Jul 31 18:55:44 1998