China Mobile, the world's largest telco, has joined a consortium that aims to form a fourth telco in South Korea that may potentially shake the country's established ecosystem.
The firm is making an initial investment of 320 billion won ($283 million), equivalent to a 40 percent share, in KT Net consortium, which is bidding to form a new telco in South Korea.
The South Korean telco market is tightly controlled by local giants SK Telecom, KT, and LG Uplus, with their respective shares remaining around 50, 30 and 20 percent for over a decade.
The government's order to form a fourth telco has consistently failed due to lack of funding from bidders up until now.
China Mobile has finalised joining the consortium and made the initial 320 billion won investment, a KT Net spokesman said. When the consortium attempts to raise 1.6 trillion won at a later date ahead of the application, the Chinese tech giant will put in an additional 320 billion won, the spokesman said.
The details have all been agreed and put on a contract, he added.
KT Net was formed by various South Korean locals who spent years attempting form a fourth telco.
China Mobile, which has 820 million subscribers, 229.2 million of whom use TDD-LTE as of August this year, is the world's largest telco by market value.
If the formation of the fourth telco is approved, it will effectively form a TDD-LTE band between China and South Korea that will allow subscribers free roaming service between the countries, which could become a game-changer.