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Initial 5G Services in S. Korea Predicted to Be Very Limited
No Profit Model in Sight
Initial 5G Services in S. Korea Predicted to Be Very Limited
  • By Kim Eun-jin
  • November 21, 2018, 13:21
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Korea's three major mobile carriers are currently setting up base stations and antennas for 5G service, but their initial coverage is likely to be narrower than that for 4G LTE services.

The South Korean government and local mobile carriers are planning to launch the world’s first smartphone-based commercial 5G services in March next year. However, the initial coverage of the services in major cities is likely to stand at only 20% to 30%.

According to industry sources, SK Telecom, KT and LG U+ are going to emit their 5G frequencies and conduct transmission and reception with their mobile routers on Dec. 1. The 5G services for general users are scheduled for March 2019, when the first 5G smartphones are expected to come out.

To that end, the three major mobile carriers are currently setting up base stations, antennas and the like in major cities. However, the actual coverage is likely to be narrower than the initial coverage of 4G LTE services. The new services are likely to be limited to the cities’ data traffic-concentrated areas and commercial zones.

In the early stage, the 5G services are predicted to be limited to data communications with 4G LTE still used for voice calls. LTE is likely to cover data communications as well in regions without 5G networks.

The mobile carriers are mulling over how to expand the coverage fast, yet profits that can be derived from 5G services are still vague. In the early days of 4G LTE, a huge number of consumers switched over to the new technique to enjoy a significantly boosted speed and video streaming services made very much easier. In contrast, expectations for 5G seem to be rather limited to immersive media such as AR and VR.

Besides, the mobile carriers now have less money to invest in the wake of the government’s policy for cheaper mobile communications. Experts point out that the government needs to provide some tax incentives so the companies can increase their investment in 5G. At present, they agree that 5G is a very important future profit source, yet remain prudent when it comes to investment with no sure-fire profit model in sight. Meanwhile, the Japanese government is providing a 5% tax cut for those investing in related facilities and Britain implemented five-year 5G facility holding tax exemption this year.