Seoul restores smartphone subsidies because premium handsets are apparently essential
(2024/01/24)
- Reference: 1706066945
- News link: https://www.theregister.co.uk/2024/01/24/south_korea_restores_smartphone_subsidies/
- Source link:
South Korea on Monday decided to abolish its ban on smartphone subsidies – in part to make premium devices more affordable.
The [1]Mobile Device Distribution Improvement Act was introduced in 2014 to level the playing field among mobile carriers by preventing deep discounting of handsets to lure customers. In theory, the rule meant incumbent carriers could not use their deep pockets to combat smaller rivals. It also helped local champions Samsung and LG (which at the time made smartphones) by easing pressure on their margins.
Critics now argue the law harms competition and keeps handset prices high.
[2]
"As the smartphone market has recently launched with a focus on premium models and smartphone prices are continuously rising, it is time to make efforts to lower the burden of people's device purchase costs," explained a Monday [3]notice from the Office for Government Policy Coordination.
[4]Samsung realizes behaving ethically is good for business, says compliance boss
[5]Samsung's Galaxy S24 pitch: The AI we baked in makes you more human
[6]ASML joins with Samsung, SK hynix, for chip research lab in South Korea
[7]Samsung creates a group dedicated to inventing whatever comes next
Like many nations, South Korea has recently experienced higher-than-usual inflation – although it's done better at controlling it than other nations and settled at an annual rate of around three percent.
But the cost of smartphones – particularly home-grown Korean ones – has climbed as manufacturers pack in more features and emphasize premium models. Samsung last week made the high-end Galaxy S24 Ultra the [8]hero of its annual smartphone launch event – a device that starts at $1,299. List prices for Samsung's folding phones are around $500 higher.
[9]
Samsung held 84 percent of the Korean smartphone market in Q3 of last year, according to [10]Counterpoint Research .
The chaebol is also seen as intertwined with South Korea's economy – so much so that Samsung Electronics boss Lee Jae-yong was [11]released early from prison to ensure his contribution to national prosperity would not be missed.
[12]
In comparison to pardoning bribery and corruption charges, removing a decade-old unpopular ban on subsidies seems like a no-brainer. ®
Get our [13]Tech Resources
[1] https://elaw.klri.re.kr/eng_mobile/viewer.do?hseq=48694&type=part&key=43
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://www.opm.go.kr/opm/news/press-release.do?mode=view&articleNo=156044
[4] https://www.theregister.com/2023/08/29/samsung_ethics/
[5] https://www.theregister.com/2024/01/18/samsung_galaxy_s24_plus_ultra/
[6] https://www.theregister.com/2023/12/13/asml_samsung_hynix_alliance/
[7] https://www.theregister.com/2023/11/28/samsung_future_business_planning_group/
[8] https://www.theregister.com/2024/01/18/samsung_galaxy_s24_plus_ultra/
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://en.yna.co.kr/view/AEN20231113001300320
[11] https://www.theregister.com/2021/08/10/samsung_boss_lee_jae_yong_paroled/
[12] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[13] https://whitepapers.theregister.com/
The [1]Mobile Device Distribution Improvement Act was introduced in 2014 to level the playing field among mobile carriers by preventing deep discounting of handsets to lure customers. In theory, the rule meant incumbent carriers could not use their deep pockets to combat smaller rivals. It also helped local champions Samsung and LG (which at the time made smartphones) by easing pressure on their margins.
Critics now argue the law harms competition and keeps handset prices high.
[2]
"As the smartphone market has recently launched with a focus on premium models and smartphone prices are continuously rising, it is time to make efforts to lower the burden of people's device purchase costs," explained a Monday [3]notice from the Office for Government Policy Coordination.
[4]Samsung realizes behaving ethically is good for business, says compliance boss
[5]Samsung's Galaxy S24 pitch: The AI we baked in makes you more human
[6]ASML joins with Samsung, SK hynix, for chip research lab in South Korea
[7]Samsung creates a group dedicated to inventing whatever comes next
Like many nations, South Korea has recently experienced higher-than-usual inflation – although it's done better at controlling it than other nations and settled at an annual rate of around three percent.
But the cost of smartphones – particularly home-grown Korean ones – has climbed as manufacturers pack in more features and emphasize premium models. Samsung last week made the high-end Galaxy S24 Ultra the [8]hero of its annual smartphone launch event – a device that starts at $1,299. List prices for Samsung's folding phones are around $500 higher.
[9]
Samsung held 84 percent of the Korean smartphone market in Q3 of last year, according to [10]Counterpoint Research .
The chaebol is also seen as intertwined with South Korea's economy – so much so that Samsung Electronics boss Lee Jae-yong was [11]released early from prison to ensure his contribution to national prosperity would not be missed.
[12]
In comparison to pardoning bribery and corruption charges, removing a decade-old unpopular ban on subsidies seems like a no-brainer. ®
Get our [13]Tech Resources
[1] https://elaw.klri.re.kr/eng_mobile/viewer.do?hseq=48694&type=part&key=43
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://www.opm.go.kr/opm/news/press-release.do?mode=view&articleNo=156044
[4] https://www.theregister.com/2023/08/29/samsung_ethics/
[5] https://www.theregister.com/2024/01/18/samsung_galaxy_s24_plus_ultra/
[6] https://www.theregister.com/2023/12/13/asml_samsung_hynix_alliance/
[7] https://www.theregister.com/2023/11/28/samsung_future_business_planning_group/
[8] https://www.theregister.com/2024/01/18/samsung_galaxy_s24_plus_ultra/
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://en.yna.co.kr/view/AEN20231113001300320
[11] https://www.theregister.com/2021/08/10/samsung_boss_lee_jae_yong_paroled/
[12] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZbCZexEIf6kVi0iAxoNSoAAAABY&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[13] https://whitepapers.theregister.com/
Good grief...
I mean, really? The article states that " ..the cost of smartphones has climbed as manufacturers pack in more features ". I really wouldnot call "moar pixels" and "moar cores" (and RAM) real "features". They are purely incremental. Most low-ish smartphones have enough of all of that, they have mostof the sensors[1]. The recent addition of "AI" is (maybe) a "feature" inasmuch as it adds something new - though AI is not a feature of the phone but the software and should run on mid tier new-ish handsets.
And who believes "subsidised" phone contracts? Don't people do the math? If you have a 24 month contract, the difference of you monthly payment for a contract with a phone to a SiM only adds up to more than the new handset price over these 24 months (usually, and when I still looked at that stuff). There are cheaper consumer credit programs, even Paypal had a zero percent interest rate payment plan[2] if you would have preferred to stretch out the payments over a longer period of time.
Ah, well. I consider it a tax on people who are bad at math, just like with lottery taxing those who are bad at statistics[3]
[1] but why do they cheap out on the compass - the sensor is likely there, just not connected. And I do not think thattis is the killer feature people are willing to pay more for.
[2] not sure if they still have it - they used to push it in a what I considered too aggressive manner. Since I have no recollection of still seeing it when I last purchased stuff using Paypl it is either gone or my brain has learned to ignore it.
[3] and state-run lottery basically fleeces the less educated to sponsor the middle class[4] lifestyle - the gamblers only get half of the money in returns, the rest pays the staff, the ads, and some of it pays for public infrastructure like libraries and pools. I'm not saying poor pople don't use these at all, but from my experience you can see a correlation between education and the kids' ability to read without using their index finger and swim[5]
[4] whoever that is... this is not really a thing in many places I used to live, and I am sort of oblivious to these things, sure, maybe I'm insensitive (and apparently my brother and I are "intellectual snobs" - we just cannot get it that some people don't know certain basic things)
[5] Apparently (i.e. I read it somewhere and cannot find the refernce, i.e. I'm too lazy to look it up) one of the nasty things a Roman could say about somebody else was that they could "neither read nor swim". Things don't change.