Even after the repeal of the Mobile Device Distribution Improvement Act last year, many consumers chose high-priced plans because of subsidies for devices, leading them to underuse their data and perceive telecom service prices as high. There are calls to separate device prices from service plans.
The Korea Consumer Federation on Jan. 8 released findings from a survey on mobile service usage and perceptions of the Mobile Device Distribution Improvement Act, conducted in October with 1,000 adult consumers nationwide to examine changes in the telecom market and how they are felt since the act's repeal in July.
According to the survey, 40.4% of respondents were on unlimited plans, but 54.5% of them used less than 100GB of data. By contrast, only 22.8% used 300GB or more.
Looking at actual data usage across all respondents, 44.4% used 0–20GB and 18.4% used 20–60GB, meaning a majority used less than 60GB. Those who said they used 200GB or more accounted for 17.9%. The average of consumers' actual data usage was 95.43GB, while the median was 28GB.
Consumers said they consider price (57.3%) the most important factor when choosing a plan. That was followed by data allowance at 27.0%, bundled discounts at 12.4%, value-added services at 2.0%, and voice calls at 0.9%.
However, 46.8% said the price level of their current plan is expensive relative to the service. Those who said it is cheap came to 13.8%, and average was 39.4%.
The Korea Consumer Federation said, "Consumers tend to use unlimited plans in excess of their actual data usage because of plan structures," adding, "Consumers consider price the most important factor when choosing a plan, but they tend to view current plan prices as somewhat expensive." It said discount structures centered on high-priced plans and complex, opaque plan designs are steering consumers toward expensive plans against their needs or preferences.
In this survey, consumers cited the most urgent tasks for improvement in the telecom market as device price transparency (24.5%), simplification of plan structures (21.5%), complete separation of devices and plans (13.7%), and improvements to contract and penalty systems (12.8%).
The Korea Consumer Federation said, "Unless discount structures centered on high-priced plans and complex, opaque plan designs are improved, it will be difficult to ease the household burden of telecom costs," and noted it plans to urge relevant ministries and agencies, including the Ministry of Science and ICT and the Korea Media and Communications Commission, to separate device prices from service charges, simplify telecom plans, strengthen transparency in pricing and discount structures, and prepare measures to prevent misselling.