Samsung is getting drawn into a battle among Korean carriers for users, with illegal discounts prompting the government regulator to limit their ability to sign up new customers for 45 days.
Samsung fails to stop early release of new Galaxy S5 smartphone in South Korea
Samsung failed to keep its new Galaxy S5 smartphone from going on sale early in South Korea today as SK Telecom and other carriers try to work around penalties imposed by the national regulator.
The world’s largest mobile phone maker planned to release the phone on April 11, yet that date would be in the middle of state-imposed suspensions preventing SK and KT Corp from doing business. LG Uplus Corp’s suspensions surround that date.
Samsung is getting drawn into a battle among Korean carriers for users, with illegal discounts prompting the government regulator to limit their ability to sign up new customers for 45 days. Samsung is counting on the marquee device to maintain its lead in a global smartphone market where it competes with Apple for high-end shoppers and Chinese producers including Xiaomi target budget buyers.
“We are very puzzled,” Samsung said in an e-mailed statement. “SK Telecom strongly asked for an earlier release of the product but we delivered our stance that the global release date of April 11 remains unchanged.”
“We decided to release the product for a wider consumer choice of handsets before our operation suspension begins on April 5,” Irene Kim, a spokeswoman for SK Telecom, said in an e-mailed statement.
Consumers can start buying the Galaxy S5 for 866,800 Korean won (US$808) from SK Telecom’s 3,000 retail stores and website, South Korea’s largest carrier said in an e-mailed statement. Existing customers of KT and LG Uplus can purchase the device under certain conditions, the companies said.
“I haven’t even unpacked it yet but I’m excited to have it,” said Ham Kyoung Jin, the head of application developer Hyundai Mobile. The 32-year-old traveled about 90 miles “just to get this new phone” at an SK store in Seoul.
South Korea’s ministry of science, ICT and future planning said March 7 it will ban SK Telecom from signing up new customers and from offering phones to users who want to change their devices without certain conditions for 45 days starting April 5 and ending May 19. Second-ranked KT currently is banned until April 26, while restrictions on LG UPlus are in place until April 4 and then resume April 27.
The new Samsung device enters a smartphone market where global growth is expected to slow to 6.2 per cent in 2018 from 19 per cent this year, research firm IDC said last month.
“Unlike the early stages of the domestic smartphone market, the power is now equally balanced between carriers and handset makers because so many handsets are in the market now,” said Kim Jang Won, a Seoul-based IBK Securities analyst said.
Samsung unveiled the S5 at Barcelona’s Mobile World Congress in February, choosing a more low-key stage for the device than it did a year earlier with the S4’s gala at New York’s Radio City Music Hall. The company sells one of every four mobile phones in the world.