South Korean telecom and pay TV services total revenue expected to decline through 2024

A GlobalData report predicts a steep drop in mobile and fixed voice revenue will drag down overall segment growth.

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A new report on the South Korean telecoms industry predicts steep declines in mobile and fixed voice revenue over the next five years.

The annual "South Korea Telecom Operators Country Intelligence Report" from GlobalData dives deep into the country's telecommunications market and examines the competitive dynamics of the industry as well as regulatory trends and the "evolution of demand by service type and technology/platform across the fixed telephony, broadband, mobile and pay TV markets."

According to GlobalData, South Korean revenue for the telecom and pay TV market will fall to $35.9 billion by 2024 from $36.5 billion in 2019. The huge amount of growth seen with mobile data, fixed broadband and pay-TV segments will be offset by the massive decrease in revenue from mobile voice and messaging and fixed voice segments.

The study predicts that mobile broadband services revenue will expand at a compound annual growth rate of 3.1% between 2019 and 2024, while total telecom and pay-TV services revenue will drop by a compound annual growth rate of 0.3%.

Global Data said mobile data would grow to 43.6% by 2024, up from 36.9% in 2019.

It attributed the growth rate spike to the growing field of machine-to-machine connections and the projected expansion of 5G services as well as increases in the average mobile data revenue accrued per user. 

"Even though 4G will be the leading mobile technology in South Korea through the forecast period, its share of total mobile subscriptions will decline from 79.2% in 2019 to 59.6% in 2024," said Deepa Dhingra, GlobalData's telecom analyst.

"With all the three major operators, SK Telecom, KT and LGU+ having launched their 5G services in April 2019 and expanding network coverage, 5G's share in total subscriptions is set to reach 40.1% by year-end 2024." 

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The report said South Korea's three major operators, SK Telecom, KT and LGU+, all launched commercial 5G services in April and have been laser focused on upgrading or expanding networks to supply the growing market demand for high-speed mobile broadband services.

"Operators are heavily investing in the expansion of their 5G networks and services to compete in the mobile broadband market," Dhingra added.

"For instance, KT has pledged an investment of $13.8 billion in 5G infrastructure and ICT convergence by 2021 while SK Telecom is aggressively deploying 5G network in all populated public areas such as highways, trains, major cities and parks."

The revenue from fixed broadband will increase at a rate of 0.9% until 2024, according to the report, which attributed the growth to the widespread adoption of fiber-to-the-home services and government efforts to increase fiber network penetration throughout the country. 

Mobile data accounts for an estimated 36.9% share of the total telecom service revenue in 2019 and GlobalData's report predicts that figure will increase to nearly 44% by 2024. 

For South Korea's pay-TV industry, GlobalData predicts that revenue will grow at a compound annual growth rate of 0.7% over 2019-2024, thanks to the steady growth of internet protocol television subscriptions.

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