North Korean 3G mobile subscriptions hit half a million

Revenue hit a record but quarter-to-quarter growth is slowing down

The number of 3G cellular subscriptions in North Korea passed half a million during the first quarter, the country's only 3G cellular operator said this week.

The Koryolink network had 535,133 subscriptions at the end of March, an increase of just over 100,000 on the end of December 2010, said Orascom Telecom. Egypt's Orascom owns a majority stake in Koryolink, which is operated as a joint venture with the state-run Korea Posts and Telecommunications Co.

Subscriber growth has been strong ever since the network was launched in late 2008, but the most recent quarter delivered the first signs that Koryolink is having to work harder for new subscribers.

The January to March period was the first time since the third quarter of 2009 that the number of new subscribers during the quarter failed to be more than the previous quarter. In the October to December quarter, the company added just over 130,000 new customers.

Revenue for the quarter was a record US$25.7 million, a jump of 185 percent on the same period of 2010. Orascom doesn't disclose net profit figures for the company.

The company is keen to launch new value-added services to raise average revenue per user (ARPU) and during the quarter it began offering MMS (Multimedia Messaging Service). Customers gave the service a positive response, Orascom said.

But despite the efforts, ARPU fell to its lowest level since service began in 2009. At just US$12.7 per month, it was down 40 percent on the same period last year.

Orascom also launched pre-paid cards denominated in euros to boost foreign exchange earnings from North Korea. The scratch cards offer free voice and value-added service use during off-peak hours.

The company's network now covers 92 percent of the population.

North Korea is one of the world's most heavily controlled countries and communication is severely restricted. Most cell phones don't have the ability to make or receive international calls.

Martyn Williams covers Japan and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

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