As generative AI services take hold as everyday tools, the subscription battleground for South Korea's three telecom operators is also changing. Cases are rapidly increasing in which AI services such as ChatGPT, Gemini and Claude are added to subscription perks that had centered on online video services (OTT), shopping and food and beverage.

As of July 22, SK Telecom, KT and LG Uplus are accelerating moves to expand AI subscription benefits, the telecom industry said. They appear to be seeking to reduce the burden of AI subscription fees while also aiming for upgrades to higher-tier plans, more transactions on subscription platforms and long-term customer retention.

AI service integration expands among the three mobile carriers

The carrier most aggressively integrating AI into pricing plans is SKT. Early this month, SKT launched three "Google AI Plan" options on its subscription platform, T Universe. Google AI Pro costs 26,900 won a month, Google AI Plus 2TB costs 10,900 won a month, and the 400GB option costs 6,900 won a month, offered at up to 2,100 won less than the list price.

SKT also made AI subscriptions a key optional benefit. Users of the "Best Pro" and "Best Max" plans launched in July can choose one additional service from YouTube Premium, Netflix, Disney+, Tving and Wavve, along with a Google AI plan. That effectively expands plan benefits from an OTT-focused structure to one that provides both AI and OTT services together.

KT combined AI benefits with its mobile phone payment service. For July, KT is offering a bill discount of 50 percent of the payment amount, up to 5,000 won, when customers pay for Google Play subscription products by phone through "KT Content Pay". Eligible products include six generative AI services: ChatGPT, Google AI Pro, Grok, Genspark, Claude and Perplexity. KT will provide an additional 5,000 won on top of the basic discount to customers paying for that AI service.

LG Uplus last month ran a promotion offering up to a 45 percent bill discount for customers who paid for generative AI service subscriptions on the Google Play Store using mobile phone billing. LG Uplus explained, "We prepared the promotion to reduce customers' burden of subscription costs and expand their experience using convenient mobile payments."

For carriers, lock-in; for AI firms, user expansion - 'win-win'

The expansion of AI subscription services by the three carriers is a strategy to encourage long-term use, industry analysts say. AI services incur monthly subscription fees, and the more frequently they are used, the harder it is to switch to another service. For carriers, combining AI subscription benefits with plans, payment services and subscription platforms can increase customer touchpoints and encourage long-term use.

In particular, as it becomes harder to differentiate mobile pricing plans based only on data and voice allowances, AI subscriptions can be used as a way to raise the perceived value of plan benefits. Analysts say that discounting AI subscription fees of about 20,000 to 30,000 won a month or offering them as plan benefits can also make the perceived discount effect relatively larger for customers.

A lock-in effect is also expected. An industry official said, "Once various subscription benefits, including AI, start getting bundled, the benefits you have to give up when switching carriers also increase," adding, "These days, it is a structure where you can even enjoy a lock-in effect with AI that you use as essential."

Another factor cited is that it can help grow subscription platforms and the mobile phone payment business. It is also possible to design tailored products or additional bundled benefits based on customers' subscription patterns in the future.

From the perspective of AI providers, cooperation with carriers is a distribution channel that can quickly increase users in South Korea. By using carriers' subscriber bases, billing systems, memberships and payment infrastructure, they can secure paying subscribers while reducing separate marketing costs.

But it remains to be seen whether it will lead to stable revenue. An industry official said, "It is important to create product combinations that subscribers will continue to use," adding, "If multiple carriers provide similar AI services, differentiation could become difficult."