North Korea: A New Mobile Network

The big news coming out North Korea this week is the launch of a new 3G mobile network by Egyptian Telecom giant Orascom. Pyongyang will be the first city to have the network followed by other larger cities. Orascom is reportedly investing $400 million in license fee and the infrastructure. Many analysts are questioning economic viability of such a venture in North Korea with its struggling economy. Mark Sutton at blog feels that Orascom might be looking at this project as a very long term investment.

Of course, it might be possible that Orascom is playing this as a very long term investment, waiting for a time when North Korea begins to open up. There has been a lot of speculation about the health of the totalitarian leader Kim Jong-il, and the Orascom group has other investments in the country, including a 50% stake in a cement company, and redevelopment work on the Ryugyong Hotel (the capital’s only prestige hotel project, which has remained unfinished for twenty years).

Wikipedia Link to Orascom Group

Riskwatchdog cautions readers and reminds them of how an earlier mobile network fared in North Korea

However, don’t get too excited. It seems to me that growth of Korea’s mobile phone network will be stunted for several reasons. In fact, this is the second time in the 2000s that North Korea has set up a mobile network. A fledgling network was launched in 2002, but this was reversed two years later, apparently because the authorities suspected that a mobile phone had been used to trigger a massive railway explosion in the northern city of Ryongchon. The blast was interpreted by some as an attempt to assassinate the ‘Dear Leader’, Kim Jong Il, whose personal train had passed through the area a few hours earlier.

The Ryongchon Train Disaster

Further down the post riskwatchdog lists three reasons why Pyongyang Fears Mobile phones. One of which is

They can make it easier for citizens to communicate with one another (that’s the whole point!). This would increase their ability to organise anti-government activities – such as protests or sabotage. For example, the popular uprising that led to the overthrow of Philippine president Joseph Estrada in 2001 was dubbed the ‘text message revolution’, because that is how the marches were announced and coordinated. Mobile phones would also allow organised crime to proliferate, and black marketeers to dodge the police by tipping each other off.

Chances are that the mobile network may only be open to the elites, the military and maybe to the foreign diplomats and business people. Even if the network is open, most North Koreans will find the fee handset price beyond their purchasing power. In any event, the launch of yet another communication network is a welcome sign.

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