South Korea

Korean operators unveil $22 billion 5G investment strategy

21 July 2020 | Melanie Mingas

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South Korea's three major mobile operators have agreed to invest US$22 billion (KRW 25.7 trillion) over the next 18 months, to boost 5G infrastructure across the country.

With a 2022 deadline, the carriers are SK Telecom, KT and LG Uplus. The investment was announced in a joint meeting with Science and ICT Minister Choi Ki-young, at the Central Government Complex in downtown Seoul, last week.

The aim is to enhance 5G quality in Seoul and six other metro cities. Further the plan will see 5G deployed in 2,000 multi-purpose facilities, on Seoul Metro lines 2 and 9, and along major highways.

In 2021, the carriers will expand 5G connectivity to an additional 85 districts, including 4,000 multi-purpose facilities, subways and all train stations, as well as 20 additional highways.

Minister Choi said 5G will become the core base of Korea’s “digital new deal”. He was quoted as saying: “The government and private sector will work together for a possible breakthrough in 5G network infrastructure to overcome the [Covid] crisis.”

South Korea rolled out the world’s first commercial 5G network on April 3, 2019, with SK Telecom Co., KT Corp. and LG Uplus.

According to government figures, since then mobile carriers have deployed more than 115,000 5G base stations across the country and, as of May 2020, South Korea had almost 6.9 million 5G subscribers, representing around 10% of the country’s 69.43 million mobile service lines.

The country is also paving the way in standalone networks (SA). LG Uplus recently said it had completed tests of core technologies supporting voice service running on SA 5G network as the carrier expects to launch 5G based on SA architecture later this year.

Rival operators SK Telecom and KT have also carried out tests of 5G SA networks and aim to launch this technology during the second half of this year, according to previous reports.

Korean operators also expect to commercialise an ultrafast mmWave 5G network for the B2B segment. However, operators have not yet finalised investment plans for the project, as the cost of building additional infrastructure still represents a "major issue". The project is likely to commence in 2021 or 2022.

To help fund this latest 5G infrastructure initiative, the government has granted the carriers tax support in the form of tax credits and other reductions specifically for telecom companies. The redirected funds are expected to be used to expand the current 14.3% nationwide 5G coverage up to 70% by 2025.