KTF wants to offer higher subsidies to higher revenue customers

South Korea’s second largest mobile operator KTF has submitted a redrafted handset subsidisation plan to the Ministry of Information and Communications (MIC), just two weeks after the state lifted its ban on offering financial incentives to customers. Since the end of last month the MIC has allowed KTF and its rivals SK Telecom and LG Telecom to offer subsidies to users that have maintained a contract with any one operator for more than 18 months. The incentives can be worth up to KRW200,000 (USD208) and be offered to both existing users and customers switching from a rival network, but the rates must first be approved by the MIC. Now KTF is looking to offer increased subsidies to higher spending customers, on a six tier sliding scale ranging from an extra KRW10,000 to more than KRW40,000 depending on how much they have spent over the preceding six months. If the MIC approves the new offer, SKT and LGT are sure to follow suit. According to the Korea Herald, SKT has benefited the most from the eased subsidy rules so far, winning 79% of new additions between the 1-10 April. It added 33,046 subscribers in the period, compared to LGT’s 9,837. KTF lost 1,078 customers, a factor that will no doubt have influenced its attempts to redraft the subsidisation rulebook.