Communications costs continue steep rise

The average Korean household’s monthly spending on communications continued to climb despite years of governmental efforts to lower communication-related costs, data showed on Wednesday.

According to data released by Statistics Korea, the average monthly spending for communications including mobile phone bills per household increased from 134,086 won ($118) in the last quarter of 2008 to 157,579 won in the first quarter of this year.

Compared to 2008, a household paid 199 percent more on average on communications devices, 13.5 percent more for various service fees, and 28.6 percent more in postal fees this year.

“Widespread usage of smartphones beginning between 2009 and 2010 resulted in skyrocketing numbers of new subscribers, which then caused an increasing trend in using not only voice services but also data services,” an official said.

The Lee Myung-bak administration in 2008 promised to reduce communications costs by 20 percent through lowering the cost of basic mobile service plans and promoting more affordable mobile phones on the market.

President Park Geun-hye also showed concern over rising communications costs. Since the transition period after her election, Park has supported eliminating the sign-up fee for mobile phones and bringing down the service fees by encouraging competition among the major telecom providers.

Years of action from the government showed negligible effects nonetheless, experts said.

The average growth rate of communications costs from 2009-2011 was about 5 percent every quarter. Last year, however, the rate doubled ― registering 11 percent, 13.2 percent and 10.8 percent in the first three quarters, respectively.

At 7.2 percent, the average proportion of total monthly household spending on communications fees was also the highest last year.

“Any policy intended to drive down communications costs should be based on the rapidly changing trend of the smartphone market,” added the official.

According to data, household spending on communications costs has increased for 14 consecutive quarters since 2009.

By Kwon Bum-joon (bjkwon@heraldcorp.com)