Major mobile carriers clash over dual prefix service

SEOUL, Dec. 3 (Yonhap) -- South Korea's two leading mobile carriers clashed
Thursday over a new service that will allow customers to have two different
numbers on a single mobile phone as they fight for a bigger slice of the already
saturated market.

KT, the country's No. 2 telecom operator, said earlier Thursday it will soon
introduce a service that will allow people to call its subscribers both on a
number with the first three digits "010" and on a number that starts with "011."
In 2004, South Korea introduced 010 as a unified telephone prefix for mobile
phones as part of the government's efforts to promote fair competition among
telecom operators.
The South Korean telecom regulator encouraged the country's mobile users to
change their old numbers to new numbers with 010. People who stayed with the old
numbers have been hampered in using third-generation mobile phones featuring
faster data transfer and video telephony.
The government also introduced a number portability system, letting users freely
transfer from one mobile carrier to another.
Until then, mobile subscribers had their telephone prefixes assigned by their
providers.
Users of No. 1 mobile operator SK Telecom were granted the prefix 011, while KT
users were given 016 and 018. Subscribers to LG Telecom, the smallest competitor,
had the phone numbers starting with 019.
Smaller rivals KT and LG Telecom often complained that the easiness of the number
011 led to SK Telecom's dominance in the South Korean market.
SK Telecom has long secured a market share of more than 50 percent, followed by
KT with some 30 percent and LG Telecom with about 18 percent.
KT stressed that the new service will simply be a call-forwarding service that it
plans to provide for two years.
"It is aimed at giving more choices to mobile users who are reluctant to change
their numbers," said a KT official, adding that it is not against government
regulations.
Some 10.8 million people, accounting for 76 percent of all mobile users in the
country, are estimated to stick to the old numbers such as 011, according to a
government report submitted to the parliament in October.
There were 45.6 million mobile users in South Korea at the end of 2008, with 93
percent of the population using mobile phones, an earlier government report said.
SK Telecom, which can no longer exercise ownership over 011, lodged a strong
objection to KT's plan.
"It is against the government's number consolidation plan," said an SK official.
KT officials refuted SK Telecom's claim.
"It will give a boost to the government's plan, as a user will be able to
transfer to 010 more smoothly."
Market watchers said SK Telecom's reaction was not unrelated to the recent launch
of the iPhone in the country.
KT, the sole distributor of iPhone in South Korea, began local sales of the
world's most popular multimedia handset on Nov. 28. KT recorded pre-order sales
of 65,000 units of the iPhone within only six days.
SK Telecom fears KT's exclusive sale of the iPhone, which is popular among
younger, tech-savvy customers, may erode its market share as their users could
more easily move into such smart phones without worrying about their numbers
being changed.
Meanwhile, the telecom regulator, the Korea Communications Commission said it
will closely look into KT's new service.
"Whether the service violates the government regulation or not should be examined
carefully," said an official at the commission.
ygkim@yna.co.kr