LIVE FROM LTE ASIA, SINGAPORE: Despite the rapid uptake of 4G and growth in data consumption in South Korea, LG Uplus has faced declining revenue over the past two years and now is looking to the Internet of Things (IoT) to expand turnover.

The South Korean mobile market has cooled down sharply since the government put a cap on handset subsidies a year ago, said Changkil Jo, VP of LG Uplus’ technology development centre, during his keynote at the event today.

LG Uplus’ revenue peaked at $10.4 billion in 2013, then fell to $10 billion last year and is estimated to drop to $9.7 billion this year.

After the market slowed, he said it has focused on strengthening its network and preparing for IoT applications, such as IoT @Home, which it launched earlier this year for $6 a month. Within 50 days it signed up 23,000 users and aims to have 50,000 by the end of year.

The operator, South Korea’s third largest, has 11.5 million LTE subscribers, which represents 83 per cent 4G penetration.

Jo noted that video is the only service that is really driving network usage, with video traffic growing 106 per cent over the last 12 months. Multimedia usage increased just 15 per cent. The growth hasn’t been the same across its user base. Data usage has been flat over the past year for customers on tiered plans, while usage increased 17 per cent – to 19GB a month – for those with unlimited plans.

Continued P2P threat
He said more than 50 per cent of its fixed traffic is commercial P2P usage, which is causing big problems. “Every year we have to invest a lot of money to enhance our network, but we don’t get any revenue benefit from that investment – the benefits only go to the OTT businesses.”

While some say cloud services will flourish soon, he said that if that level of P2P traffic continues, the move to the cloud won’t go any further. “They [OTT businesses] don’t invest in any facilities for their services except servers; they just make use of the operators’ vast resources to make large profits.”

He insisted it’s time for operators to jointly work together to counter their threat. “They are exploiting our resources… it’s like stealing money from our industry. They should have to invest.”

He said the country’s operators have complained to the government and asked it to take action.