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 Monday, January 14, 2008

South Korea's Korean Investment Services has reported that during 2007, the three local mobile operators had net additions numbering 3.3 million. Considering annual net additions were only 1.76 million in 2005 and 1.86 million in 2006, the 2007 result was quite exceptional, caused by stiff competition for subscriber attraction and 3G marketing.

Although all three companies could not avoid seeing eroded profitability due to higher marketing costs, sign-ups gained in 2007 should contribute to sales growth from 2008.

SK Telecom and LG Telecom were relatively strong in subscriber attraction over the last year. In particular, as SK Telecom sought to defend its market share of 50.5% from the beginning of last year, its annual market share of net additions exceeded 50% for the first time since 2003. LG Telecom was also successful with 0.8 million net additions by focusing on 2G subscriber attraction in contrast to KTF, which concentrated its marketing efforts on early 3G services.

Handset sales: Dropped slightly MoM

In December, the number of mobile telecom subscribers reached 43.5 million with the service penetration rate up to 89.3%.

The number of 3G service subscribers grew by 0.9 million in December to reach 5.7 million, or 13.1% of all mobile signups. SK Telecom attracted 466,314 net additions to its 3G service, beating KTF’s 431,108 for the fourth straight month. In cumulative numbers, SK Telecom and KTF have 2.5 million and 3.2 million, which account for 9.3% and 20.3% of total subscribers, respectively.

The research firm said that it expects that the cumulative numbers to reach 16.5 million by the end of 2008 and 27.5 million by 2009. LG Telecom, which should start full-fledged 3G service this year, should accelerate the migration.

Source: Cellular News.