Will South Korea have a million 5G customers by end of June?

Image credit: Richman Photo / Shutterstock.com

As with 2G, 3G and 4G (though less so for 4G), operators are maintaining their ‘build it and they will come’ approach to 5G monetisation. As before, they’re thinking that if they provide the additional speeds and capacity, other members of the 5G ecosystem will find ways to capture consumer imagination. And this has always been the approach (albeit unintentional in some cases). SMS did it for 2G, the iPhone did it for 3G, and ultimately, together with additional bandwidth available, did it for 4G too.

2G, 3G and 4G took some time to get going and enjoy mass adoption. The reason – lack of handset availability. Back in the early 1990s – the joke at the GSM Congress was that GSM stood for God Send Mobiles. The first 3G phones were, frankly, pretty poor and the photo messaging was worse. As for 4G – it’s hard to believe that it was launched 10 years ago in 2009, and for the first year the only devices were dongles that you stuck into your laptop. The big difference with the 5G launches that we’re seeing now is handset availability.

And this is making a huge difference.

At the start of April, the three mobile operators in South Korea launched 5G. South Korea’s vice minister for the Ministry of Science and ICT recently stated that there were 600,000 5G subscribers in Korea, 50 days after the initial launch. Having the Samsung 5G S10 available has certainly helped with uptake. The forecast is 1,000,000 5G customers in Korea before the end of June. Reports are highlighting between 15,000 and 20,000 customers are signing up for 5G per day.

Data usage is also going through the roof. Korean operators LG Uplus said that 5G usage is averaging 1.3GB per day, up from 400MB with LTE. Meanwhile Korea Telecom have also reported that 5G data usage also was up at least threefold compared with 4G data traffic. New services featuring AR and VR functions are proving popular and already account for 20% of 5G traffic, compared with 5% for 4G.

As for revenues, it seems that these early adopters are happy to pay a premium for 5G speed and the new services it enables. Total Telecom reported that an unlimited 5G data plan costs $42 (50,000 South Korean Won) per month with an unlimited 4G plan coming in at $25 (30,000 SKW) per month.

As covered in the Openet blog in April, SK Telecom said that they would have “around 8,000 different content offers in diverse areas including game, ultra-high definition (UHD), AR and VR”.

The 5G stats from South Korea are impressive and highlight the opportunities that 5G can present.

  • 50 days after 5G launch: 600,000 5G subscribers
  • Data usage: 325% increase over 4G. From 400MB per day with 4G to 1.3GB per day with 5G
  • Unlimited data plan: $42 for 5G, $25 for 4G
  • Number of planned content offers: 8,000 from one operator

The new opportunities enabled by 5G go beyond consumer applications. Within a month of launch SK Telecom announced a number of deals to use its 5G network for applications across smart cities, autonomous vehicles and connected hospitals. This shows the potential in the smart buildings / cities that 5G can deliver. In many cases the operators will be providing the 5G connectivity with the applications delivered by partners.

From the Korean example we can see that 5G means more consumer and enterprise services, a lot more data consumed than 4G, a high adoption rate and increase in ARPU.

Tony Regan, is General Manager of Consulting and Strategic Alliances in Openet. Tony joined Openet from Telefonica where he had performed in various group roles for the past 14 years.

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