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North Koreans Adopting Mobile Phones, Increase 50% to 1.5 Million Users This Year

Though North Korea is still primarily locked away from the rest of the world, there are some signs that things might be slowly changing, at least on the technology front. While Chinese and South Koreans are snapping up smartphones and texting on Weixin and Kakao Talk, North Koreans are just perceptively entering the cell phone market, and the pace is picking up relatively quickly.

Since 2008, North Korea has started to use cell phones, and this year cell phone users have reportedly hit the 1.5 million mark. This is approximately 50 percent from last year’s 950,000, according to Egyptian tycoon Naguib Sawaris, owner of telecom operator Orascom. He expects this to hit 1.7 million users by the end of the year, and this would mean that of a country with roughly 24 million people,  7% will have a mobile phones by the end of this year.

Currently Koryolink is the only operator in North Korea, and Mr. Sawaris’s Orascom has a 75% stake in the company. He is helping the country build their first mobile network, and it appears to be developing fast this year. In an email exchange with Forbes, Sawaris boasts that revenues will reach $145 million for 2012, with an average of $11 per user. Currently mobile service is offered in 14 major cities, 74 smaller cities, and on 22 highway systems.

While there are few signs of opening up on the horizon for North Korea, if there is any solace to be found in this news it is that technology may produce new ideas for the population and open them up to the inventions of the rest of the world. If the income of North Koreans is rising enough for them to be able to purchase phones, this could be a game-changer for them in the future.

Orascom and its stake in Koryolink will lose exclusivity rights in the market at the end of this year, but the government has stated that until 2015, foreign investment will not be allowed in the mobile business. This means that they will be protected from competition unless domestic competition springs up against the Egyptian giant.

Yet there is an element of pessimism in this as well. Presumably this move will allow them to continue building up infrastructure in a way that complies with the regime’s preferences. Since October last year, the North Korean government has been promoting a cell phone model called “1913” which is limited to the city of origin, sports only voice and texting capabilities, and has no recording, Bluetooth, video or photo transfer functions. The Internet is still closed to North Koreans, so they will not be allowing people to propagate information out of fear that it might be destabilizing.

Reforms will be rather slow for now, but it is at least a start in the right direction.

Source: Sina Tech, Forbes

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