South Korea to bring unlimited data options to budget mobile carriers

Budget mobile subscribers will be able to keep using the internet even after exhausting their data allowance as early as August, as the government moves to extend a "data safety option" (QoS) to mobile virtual network operators.

The plan aims to help budget carriers maintain price competitiveness while also raising service quality, with the ultimate goal of easing consumers' mobile bill burden.

The Ministry of Science and ICT unveiled the measures Friday as part of its "MVNO 2.0" package at a joint ministerial meeting on economic affairs and household price management. The initiative comes as the budget carrier sector reaches a milestone of 59 operators and about 10 million subscribers, and is designed to prevent service quality from deteriorating due to carriers' lack of their own network infrastructure.

Under the plan, the three major carriers will wholesale new 5G budget rate plans — including a data safety option with QoS speeds of 400 Kbps — to budget operators.

The data safety option will be applied at no additional cost to 91 revenue-sharing (RS) rate plans. The ministry will also push to expand wholesale provision of the data safety option to metered (RM) plans and reduce associated costs. Wholesale RS rates paid to the major carriers will be cut — LG Uplus will lower rates on eight 5G plans by 3 percentage points, KT on seven plans by 1 to 1.5 percentage points, and SK Telecom on two plans by 1 percentage point.

Later this year, an amendment to enforcement regulations will expand the radio frequency usage fee discount for small and mid-sized budget carriers from 50 percent to 90 percent. The measure is expected to save the industry about 25 billion won ($18 million) in costs annually.

The ministry will also establish a regulatory framework to support partial MVNO and full MVNO models, allowing budget carriers to design their own rate plans and services using their own infrastructure.

Partial MVNOs own some of the infrastructure needed for billing, charging, and subscriber identification and authentication, enabling them to independently design rates and services. Full MVNOs go further, holding both service-layer and traffic management infrastructure to deliver fully independent mobile services.

To that end, the Ministry of Science and ICT will pursue regulatory amendments to extend the mandatory network interconnection obligation to all three major carriers and introduce differentiated wholesale pricing based on the level of infrastructure a carrier owns.

Efforts to expand access to affordable handsets will run in parallel. The ministry will continue to promote a certification program for safe used-phone transactions and will recommend to fiscal authorities that used handsets be eligible for tax deductions. Starting next month, a consultative body bringing together relevant government agencies, manufacturers and retailers will be formed to accelerate the spread of mid- to low-priced and unlocked devices.

Also later this year, the ministry will revise regulations to promote eSIM adoption, enabling instant online activation without the need to deliver or swap a physical SIM card. Improvements to the eSIM fee structure and standardization and simplification of issuance and transfer procedures are also expected to follow.

"We will push ahead with MVNO 2.0 at pace so that people can experience more affordable, diverse and reliable mobile services," the ministry said. "Through these measures, we expect to see continued growth in the budget carrier subscriber base and an increase of at least three operators running partial or full MVNO models with their own infrastructure, fostering a sustainable MVNO ecosystem."