South Korean discount store chain, Home plus, has launched its own telecommunications service.
Home plus is using KT's network as a mobile virtual network operator (MVNO) after signing an agreement with the local carrier last year, Korea Times reported Wednesday. Home plus is wholly-owned by British retail giant Tesco.
Home plus' latest offering is the first for a discount chain store in the country, and comes as the government's plan to expand MVNOs to help address growing consumer complaints over rising phone bills.
MVNOs lease operator's networks without incurring operational costs, so they are able to provide services to customers more cheaply, the report noted.
Home plus said its wide distribution network will help consumers save costs. It offers five plans, the cheapest being a 6,000 won (US$5.38) monthly fee and charges 1 won per second for voice calls. (11 won is US$0.01)
In contrast, plans from telcos usually see a monthly fee of over 30,000 won (US$26.89), charging 1.8 won per second.
"We want to establish ourselves as a business that helps households pay less for telecommunications services through Plus Mobile. Our customers will be able to gain seamless connection through KT’s excellent network at affordable prices," said a Home plus spokesman.
The company said it currently only offers 3G connection, and plans to add 4G or long-term evolution (LTE) at a later date. Customers can subscribe and purchase handsets at 134 Home plus stores across the country. They can also subscribe with their existing handsets, by changing their universal subscriber identity modules (USIM), according to the report.
It added that it benchmarked itself against MVNO Tesco Mobile in the U.K., which has 3 million subscribers since it started in 2003.
Subscribers to Plus Mobile will also gain access to KT's 200,000 Wi-Fi access points in South Korea, the report said. A KT spokesperson said: "As a responsible business, we're happy to provide our network to Home plus and will continue our efforts to make telecommunications accessible to everyone."
KT runs second-largest wireless and largest fixed-line networks in the country, the report said.