LG Telecom's Dilemma

Pres. Nam ready to resign over company not operating mobile IMT 2000

On the occasion of the founding anniversary of companies, the CEO usually hold out a rosy blue print for the company, but not President Nam Yong of LG Telecom. At a ceremony marking the 10th anniversary of LG Telecom held at Chosun Hotel on July 4, President Nam called for sharing of 800 MHz that SK Telecom has been exclusively using, a move that put the rival telecom company into a tough corner.
President Nam already received firm "no"answers from SK Telecom's President Kim Shin-bae on many occasions, but he once again brought up the matter publicly. His reasoning is that the 800 MHz wave length is the most effective one and no company should be allowed to have exclusive rights to the wave length as its been done in Korea, a situation that cannot be found outside the country. He said that he will bring the matter to authorities, if SKT refuses to hold talks to resolve the matter.
His reasoning has merit and is laid out in the following manner. It takes a lot of money for other telecom companies to build communication networks in local regions and isolated areas, which are not necessary if SKT allows other late starters to share the wave length on a lease basis.
"SKT should stop discriminating against late starters and resolve the problem. Otherwise, the late starters would have hard time to maintain operations,"LGT President Nam claimed. He raised his voice as he raised the following question "Why is it impossible even if they pay rental fees?" Nam declared "My Way"and decided not to follow SKT and KTF to launch the operation of IMT-2000 service, which provides a mobile phone with the function to facilitate image communication. LGT got the license to launch the IMT-2000 service in 2000 from the government with the promise that it will launch it by June, 2006. But the company opted not to begin the new service and therefore, it has to return the license to the government.
President Nam said he won't be pushed to start the service by the government, adding that no country in the world has been able to start the service. There is no reason to start the service within a year or two from now, he stressed.
In the LG Group, Nam is a hero whose offensive management leadership has saved the company. The company recorded sales of 942.9 billion won in the first quarter with net profit of 105.4 billion won, the largest since the company began operation, with the number of subscribers reaching 6.76 million.
He managed the company to overcome its decisive weakness of being a late comer in the business through reform. From 2003, for example, he had all officers and employees of the company including himself undergo a training program at the LG Electronics Changwon complex reform school to hone their skills.
Last year, all employees made a tour of Toyota Motor plants in Japan for jobsite training to learn the Japanese motor company's programs to save costs and boost productivity at the same time and apply them to the telecommunication operation through a massive reform campaign.
In the meantime, the Ministry of Information and Communication cancelled the license for mobile IMT-2000 from the LG Telecom for incompliance with the terms of the license. LG Telecom has opted not to pursue the business due to many difficulties involved in operation. The company's president Nam, in a telephone interview with a reporter, said he is ready to resign, taking responsibility for the company's decision not to operate the system. He also appealed to the ministry it make sure that no harm will come to the company, since he will take the entire responsibility. He also said no ministry officials should also be reprimanded in connection with the case. He also explained the inevitable reason for the company's inability to honor the license. He had two options: one is to pay the government 930 billion won unpaid out of 1.150 billion won to be paid to the government in the form of investment in return for the license; the other option was for Nam to resign and return the license. President Nam apparently has taken the second option. nw

President Nam Yong of LG Telecom