Telecom firms keep quiet about required deals

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Telecom firms keep quiet about required deals

One of the best deals available for mobile phone users is also among the least known.

Consumers can get 20 percent off their mobile phone bill every month if they don’t opt for a new, subsidized smartphone.

They can also receive the same discount every month if they extend their existing two-year contract for another year or two without upgrading to a new, subsidized phone.

But according to the Korea Consumer Agency (KCA) on Tuesday, only 39.8 percent of consumers know about the discount. Of those, only 13.2 percent are actually receiving it.

The KCA surveyed 1,000 people who had purchased a mobile device in the last two years.

The reason? Even though the new regulations went into place last year with the mobile device distribution law, telecommunication companies aren’t telling anyone.

The top providers - KT, SK Telecom and LG U+ - have a notification for the discount in a banner on their websites, but all place it in a hard-to-see corner of their page.

Consumers themselves have rated telecom companies poorly when it comes to notifying them about discounts.

In the KCA’s survey, users gave telecom companies an average 2.95 out of five when it comes to transparency in discounts, with five being the most up-front.

The KCA said the companies need to be more aggressive in promoting discounts like the 20 percent deal, including making information about discounts more visible on their websites and in larger text.

Among the consumers who knew about the discount, 48 percent said they were reluctant to apply because they weren’t sure if they would stick with their device for at least another full year and worried they would have to give back the discount they had received if they decided to opt for a new one.

The second-largest group, at 25.8 percent, said they didn’t know how to apply.

Others, at 14.7 percent, cited limitations related to their USIM chip.

Not all these fears are founded.

According to the revised regulations, users who receive the discount don’t have to return the amount they received if they switch devices - as long as they purchase their new device from their same carrier. But if a user receiving the discount switches their USIM chip into a phone bought from a third-party retailer, his or her contract does actually expire, and the discounts received thus far must be refunded.

The telecom providers argue that if a user switches his or her USIM card, they can’t tell whether the new phone had already been discounted by a provider, cheating them out of money.

However, the KCA disputes that claim, saying companies can verify a phone’s subsidy history through the Korea Association for ICT Promotion.

The KCA called on the companies to allow users to switch their USIM chip into a device and keep their subsidy as long as they follow all the rules.


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