Published : Dec. 20, 2015 - 19:40
Mobile carrier KT has ratcheted up criticism of its local rival SK Telecom’s plan to acquire CJ Hellovision, a cable TV and mobile virtual network operator.
Lim Heon-moon, president of KT’s mass general business division in charge of the business-to-customer segment, said Friday that SKT’s acquisition of CJHV is something that would “wreak havoc to both telecommunications and broadcasting industries.”
He went as far as saying that SKT, the No. 1 wireless carrier with its market share reaching almost 50 percent, is deceiving the government and the public by claiming that it would create new values through convergence between the telecom and broadcasting businesses.
KT president Lim Heon-moon speaks at a press meeting in Seoul on Friday. (KT)
“The acquisition, if approved, will just allow SKT to build a monopoly in both the telecom and broadcasting sectors, which will consequently limit the consumers’ choices and deteriorate the markets’ competitiveness,” he said at a year-end meeting with the press.
SKT, which has Internet Protocol TV operator SK Broadband under its wing, has been pushing to acquire Korea’s top cable TV operator CJHV. The mobile carrier also plans to merge the two business entities, following the acquisition.
The twofold M&A deal, if approved by the government’s regulatory agencies in February next year, would send the merged firm into second place with an estimated 7.5 million subscribers -- 4.2 million from SK Broadband and 3.3 million from CJHV -- in the pay TV market.
KT is currently the No. 1 player in the pay TV market with a total of 8.4 million subscribers under its cable TV service olleh and satellite TV service Skylife.
CJHV, which tops the local MVNO market, will also help SKT to cement its dominant position in the wireless network market, KT claimed.
SKT has 28.5 million subscribers to its mobile services, which translates into a whopping 49.5 percent market share, outpacing the subscriber bases of KT and LG Uplus, which respectively have 17.5 million and 11.6 million.
Mentioning U.S. mobile network operator AT&T’s failed attempt to take over its rival T-Mobile, which the KT president said the U.S. Federal Communications Commission had blocked since the two businesses are complementary to each other, he argued the planned M&A between CJHV and SKT -- leaders in the pay TV and mobile network segments, respectively -- should not be approved.
The FCC, on the other hand, approved AT&T’s $48.5 billion acquisition of DirecTV since their businesses were supplementary to each other, according to KT.
Despite condemnation from its competitors KT and LG Uplus and the broadcasting industry, SKT previously said it would stick to its initial M&A plan, promising to make investments to beef up the competitiveness of the entire telecom and broadcasting markets.
Speaking on the company’s business plans for the next year, Ku Hyun-mo, senior vice president of KT, said the company would “integrate ICT into the nation’s first Internet only-bank, dubbed K-Bank to achieve innovations in the financial sector while cooperating with the government.”
KT, a leading member of the K-Bank consortium to establish the nation’s first Internet-based banks, plans to launch the bank in January.
By Kim Young-won(
wone0102@heraldcorp.com)