SEOUL, Nov. 26 (Korea Bizwire) – South Korea’s No. 1 mobile carrier SK Telecom Co. has reduced its spending on advertisements through September this year, data showed Thursday, in line with its efforts to recoup losses from a government-led policy aimed at lowering cell phone users’ bills.
The mobile carrier spent 132.2 billion won (US$116 million) on advertisements in the January-September period, down 15 percent from the 156 billion won posted a year earlier, industry data showed.
SK Telecom said earlier its third-quarter net profit sank 28.1 percent from a year earlier due largely to a government-led discount policy for mobile phone users.
Net income reached 381.8 billion won through September, plunging from a profit of 531 billion won the previous year.
Pushed by the government to ease the burden of high phone bills for households and individuals, local mobile carriers were required to offer monthly rate plans that come with a higher discount rate instead of a rebate.
Industry watchers said SK Telecom has also been struggling to cut costs as it spent 100 billion won in the first quarter as compensation for layoffs.
While the top mobile carrier, which takes up roughly half of the South Korean market, reduced marketing costs, its smaller rival KT Corp. and LG Uplus Corp. increased such expenditures.
KT spent 128.2 billion won on advertisements in the January-September period, up 17 percent on-year, while that of LG Uplus advanced 20 percent to 249.1 billion won.’