Korea Telecom has ceded to government pressure and followed rival SK Telecom’s move to cut tariffs.
South Korea’s second largest carrier said in a statement that it will reduce its monthly fee by 1,000 won ($0.90) from October, a move similar to SK Telecom.
According to the Korea Times, KT will also give subscribers 50 free text messages a month from November and introduce new smartphone plans from December.
KT spokesperson Kim Yoon-jeong said the price cuts are expected to help customers save up to 28,500 won by year.
The reductions will apply to both KT’s 2G and 3G users. Kim said KT’s 350,000 2G users would also enjoy updated price plans if they preferred to continue using the 2G service after September. KT had earlier announced it would stop its 2G service from next month.
The country’s smallest mobile player LG U+ is also set to cut tariffs. A spokesman from company told the Korea Times that the company stood to lose 220 billion won annually should it implement similar rate cuts as its larger rivals. LG U+’s revenue stood at 666.3 billion won last year and is the country’s only operator that does not retail Apple’s iPhone and iPad.
LG U+ is expected to announce rate cuts later this month. The firm is currently finalizing the extent of the price slashes with the country’s regulator, the KCC. The LG U+ spokesman added lowering tariffs might not be the only option as offering more voice calls and text messages could also bring more value to the customer while minimizing the impact on the carrier’s bottomline.
South Korea’s three mobile operators have faced pressure from the KCC to reduce tariffs since earlier this year in order to cut inflation in the country.