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LGT to limit customer subsidies


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According to JoongAng Daily, the newly merged LG Telecom (LGT) has said that it does not intend to enter in to excessive marketing conflicts with its rivals, nor will it launch new projects that break the conventions of the local telecom market.
According to JoongAng Daily, the newly merged LG Telecom (LGT) has said that it does not intend to enter in to excessive marketing conflicts with its rivals, nor will it launch new projects that break the conventions of the local telecom market.

LGT’s vice chairman and CEO Lee Sang-chul said of South Korea: ‘The telecom market has passed the peak of its growth on an S-curve and is now at its ebb,’ while claiming that should the country’s major operators continue to spend the estimated KRW8 trillion (USD7.04 billion) they do on customer subsidies, that the creation of new services will remain untenable.

LGT absorbed its fixed line subsidiaries – LG Dacom and LG Powercom – earlier this month, having received approval for the tie-up from the Korea Communications Commission (KCC) in December 2009. Following the merger the new entity is expected to post annual sales of approximately KRW8 trillion, while the move is also likely to allow LGT to cut marketing costs. The combined company’s focus will reportedly be on fourth-generation mobile networks, alongside bundled services, with a particular emphasis on attracting corporate customers.


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