IMT-2000 Licensing Likely to Favor 3 Licensees, Modified Beauty Contest

Korea Times (Seoul, Korea), June 27, 2000 | Go to article overview

IMT-2000 Licensing Likely to Favor 3 Licensees, Modified Beauty Contest


With the Ministry of Information and Communication set to wrap up the review of the IMT-2000 license bidding process earlier next week, potential bidders are raising their voices and yet key questions remain unanswered.

The number of licensees, screening methods and technology standards are three major issues for the government as well as bidders, but a smooth agreement is nowhere to be seen.

Mobile-phone operators, industry experts and ministry officials generally favor three licensees in the form of consortium. The trouble is that there are so many contestants.

SK Telecom, the nation's biggest mobile operator, and Shinsegi Telecomm, which is in the process of being merged into SKT, have set up their own group for the IMT-2000 bidding.

Another force is Korea Telecom, a state-run telecom operator, which owns a mobile-phone unit of KT Freetel and recently took over Hansol M.com, a mobile carrier.

The third bidder is the family-owned LG Group, led by LG TeleCom, LG Electronics and Dacom.

Korea IMT-2000 Consortium, grouping small and medium-sized telecom outfits, is the smallest and yet a vociferous bidder for the next-generation wireless communication license.

As the four bidders are trying to grab three licenses, one is destined to lose out. The defining question is whether the government will back new entrants in the name of encouraging fair competition, or limit the pool to the experienced players.

No wonder, then, that Korea IMT-2000 desperately argues for the necessity of allowing new entrants as a policy. It repeatedly claimed IMT-2000, or 3G, was a totally new multimedia-enabled telecom service, which means existing carriers do not necessarily have preexisting advantages.

The consortium is supporting an option under which the three licensees should be broken down to two existing mobile carriers and one new entrant.

Ministry officials, however, do not agree with this idea, saying that if the consortium wins the 3G license independently, it might leave the scene irresponsibly after recouping capital gains by selling off its shares to third parties.

Korea IMT-2000 Consortium rebuffed this argument, claiming that such a theory is ``ridiculous.''

Said Lee Chong-myong, director of Korea IMT-2000 Consortium: ``It's a groundless argument by other mobile-carriers, aimed at blocking small companies from joining the 3G project.''

Lee also said the screening process based on existing carriers was feared to lead to the formation of illicit cartels, which could undermine consumers' rights.

Last week, the Korea IMT-2000 Consortium clashed with the ministry over its preliminary share subscription campaign, a move it argued was legal. …

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IMT-2000 Licensing Likely to Favor 3 Licensees, Modified Beauty Contest
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