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LG Telecom Faces Losing 3G License
[July 14, 2006]

LG Telecom Faces Losing 3G License

(Korea Times Via Thomson Dialog NewsEdge) By Kim Tae-gyu

LG Telecom, Korea's No. 3 mobile carrier, is expected to lose its third-generation (3G) license in line with the decision of an advisory panel at the Ministry of Information and Communication (MIC).

As a result, LG Telecom chief executive Nam Yong is likely to lose his position as the relevant law on licenses of the country's 3G telephony service stipulates.

The 20-member panel, the non-standing commission affiliated with the MIC, yesterday asked the information ministry to deprive 3G license of LG Telecom.

The MIC plans to make the final judgment on the issue early next week and it is projected to be in accordance with recommendations of the panel, composed of top telecom and law experts.

The resolution came as LG Telecom had failed to comply with its commitment of starting 3G services in the 2-gigahertz bandwidth by the end of last month.

At a press conference early this month, Nam officially announced LG Telecom was unable to abide by the pledge for some reason. Instead, he promised to upgrade its current 1.8GHz network.

``We opted not to invest in the 2GHz bandwidth for the time being, considering the technological trends in the global wireless market,'' Nam said at the time.

LG Telecom got the 3G license in 2001 for 1.15 trillion won and has so far paid 220 billion won. After issuing the final decision on the license next week, the MIC will settle on how to deal with the fees.

Although the MIC has generally respected recommendations of the advisory committee, the ministry would be unable to do so completely at least this time as the panel has asked the MIC to help Nam retain his job.

Just after the gathering of the advisory panel, MIC director general Kang Tai-young reiterated the ministry's will to follow the regulations, which force the chief executive of a company negligent of 3G license-related duties to step down.

Rumors are already escalating about the future of Nam, who has successfully headed LG Telecom since 1998 to expand its user pool to 6.5 million.

It is possible he will move to LG Electronics, the country's leading home alliance maker as a sister company of LG Telecom, or remain at LG Telecom as its vice chairman, the honorary position.

Among likely successors to Nam is Kang Moon-seok, executive vice president of LG Telecom.

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