"It does not offer T Membership benefits or bundled wireline-wireless discounts that SK Telecom provides, but we planned a plan that is cheaper than existing ones."
Lee Yun-haeng, Head of Team for SK Telecom's Air Planning Team, said this on the 1st at a press briefing held at T Factory in Seongsu-dong, Seoul, while introducing "air," a new telecom brand exclusively for customers with self-purchased phones (new devices bought directly from the manufacturer without going through a carrier).
The Air plans were streamlined into six options, from a monthly flat rate of 29,000 won (7GB) to 58,000 won (unlimited). Subscribers can receive up to 5,000 won in points each month, which can be used to pay their bill, bringing the monthly fee down to as low as 24,000 won, according to SK Telecom. Points can be earned by joining games or completing step-count missions in the Air application (app). If you walk more than 10,000 steps in a day, you can receive 100 points, and 10 points are awarded each time you participate in a game.
The Head of Team explained, "By combining a simple plan with only the essential features and point benefits, we realized telecom 'minimalism,'" adding, "SK Telecom has 268 value-added services and benefits, but Air reduces them to 30 to lower the price."
SK Telecom said Air accepts sign-ups only through an online app. The Head of Team said, "Customers can sign up 24 hours a day whenever they want. Because activation is possible immediately with eSIM, the time from verification to activation is only 1 minute 30 seconds." The Head of Team added, "We targeted users of self-purchased phones who want to activate online, so there will be no touchpoints that conflict with offline sales," and "We have not even considered plans to release separate dedicated devices for self-purchased phones (to avoid conflicts with offline)."
Another feature of Air is that it operates 100% contract-free plans only. This means customers can cancel freely at any time. Typically, a two-year contract offered a 25% discount, but Air aims to provide cost-effective rates comparable to that without a contract. The Head of Team said, "If you sign up for Air, you have to forgo T Membership benefits or bundled wireline-wireless discounts available from SK Telecom," adding, "Instead, because there is no contract, you can cancel freely at any time. There is no membership, but we plan to gradually strengthen Air's own benefits."
SK Telecom also noted that, because it accepts activations only through an online app, it took exhaustive security measures. Jeong Jun-young, Head of Team for Air Service, said, "We require basic identity verification when entering the app, and only after an electronic signature can the person proceed with activation. We tried to prevent others from initiating activation," adding, "Because security is the core of contactless activation, we are in ongoing discussions with government bodies such as the Korea Information & Communication Advancement Association (KAIT) and are fully prepared to continuously strengthen security."
Inside and outside the industry, some say SK Telecom launched a separate telecom brand dedicated to self-purchased phones to reduce marketing expenditure from subsidy competition after the repeal of the Mobile Device Distribution Improvement Act. A telecom industry official said, "Self-purchase customers do not buy devices through carriers, so there are no subsidies borne by the carrier. And because customers are acquired only on a no-contract basis, there is no obligation to provide separate rate discounts," adding, "For no-contract customers, there is also no burden of the 'additional subsidies provided to customers with two-year discount contracts' that emerged after the law's repeal, making it a good alternative to minimize marketing expenditure."
SK Telecom's new telecom brand Air for self-purchased phones is scheduled to officially launch on the 13th.