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[wylies99]

02-03-2009 18:31

Internet Phone Users Jump to 2.5 Million
http://www.koreatimes.co.kr/www/news/tech/2009/02/133_38904.html

By Kim Tong-hyung
Staff Reporter

For Internet telephony operators at least, the economic turmoil has been a godsend. With times getting tough, more and more telephone users are switching to voice over Internet protocol (VoIP) services, which provide cheaper rates on long-distance calls and other up-to-date features.

Riding the bargain-hunting wave are LG Dacom and SK Broadband, both finally having a fighting chance against KT, the country�s biggest telephone company, now beleaguered by declining fixed-line telephony sales.

The country�s 11 VoIP operators have gathered 2.5 million subscribers so far, since passing the two million mark last October.

Leading the pack is LG Dacom, which has 1.2 million VoIP subscribers, and Samsung Networks, a distant runner-up with 370,000 customers. KT, which controls nearly 90 percent of the fixed-line market, comes third with 320,000 customers.

The attraction of Internet telephony is obvious ― the basic rates are lower than existing fixed-line services and operators are charging the same rates for local and long-distance calls. VoIP users are also provided with a variety of added features such as text-messaging, video calls and basic data services such as weather information and stock updates, while voice quality no longer seems to be a problem.

Any household with broadband Internet or cable television can simply subscribe to Internet telephony by just adding a VoIP phone.

Industry watchers expect the country�s VoIP subscribers to exceed five million by the end of the year, accounting for about 20 percent of household telephone subscriptions, as consumers continue to tighten their purse strings.

The transition has been accelerated since the government allowed number portability for VoIP calls, allowing telephone users to switch carriers without changing their existing numbers.

``VoIP is proving to be a business model that can thrive in difficult times,�� said an LG Dacom official.

``Number portability has certainly been a factor and the market could further explode as operators compete to introduce new phones and strengthen their marketing efforts,�� he said.

The rise of the VoIP market comes at the expense of the traditional public switched telephone network (PSTN) market, which is quickly decaying as a business model.

The biggest loser on that end is KT, which lost 650,000 fixed-line subscribers in December alone, although its 19.8 million subscribers still account for more than 89 percent of the PSTN market.

Telecommunications operators are now bundling their VoIP services with fixed-line, mobile, broadband and Internet protocol television (IPTV) services provided by their subsidiaries, providing further discount options for customers.

LG Dacom, SK Broadband, KT and cable television operators are all charging around 38 to 39 won per three minutes for their VoIP calls. Basic rates are around 2,000 won, although SK Broadband doesn�t charge its subscribers basic rates if they also use the company�s broadband Internet services.

The VoIP operators charge 50 won per minute for international calls to countries such as the United States, Japan and China, although rates differ by country.

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[PeterDragon]

An interesting article. Out of curiosity, does anyone know what the Korean useage rate is for entirely software based VOIP services such as Skype, Yahoo Voice, or whatever th Korean equivalent is for these?

[Orsyn]

Not sure about rates in Korea. What's great about VOIP is that you can basically purchase 2 receivers/video phones and ship one overseas. They plug into the internet and you can basically make unlimited international calls for just the monthly charge.