Performance, not patriotism

Local wireless carrier KT stopped selling the latest smartphone by Chinese brand Xiaomi after two days, but it’s unclear why.

KT had been offering the 16-gigabyte Xiaomi Redmi Note 3 at 69,000 won ($57.6) and the 36-gigabyte model at 119,000 won to anyone who would begin a new contract with the carrier through an online shopping mall from Jan. 4.

Orders flooded in, as the full-spec phones were available cheaper here than in China. But KT suddenly stopped the sales, saying the special deal was carried out by its marketing unit without consultation with headquarters.

Consumers and industry insiders, however, believe KT had been pressured by local smartphone makers uncomfortable with the inroads being made by their cheaper Chinese rivals. Samsung Electronics has lost its top position in the Chinese market to Xiaomi, with the 6-year-old Chinese company’s share of mainland market now more than double that of Samsung. Some must have been fearful of the company’s possible success in the local market beyond a major wireless carrier.

The domestic smartphone market is dominated by smartphone-makers Samsung Electronics and LG Electronics, and distributors SK Telecom, KT and LG Uplus, which are all household names in Korea. Foreign brands are rare due to highly regulated domestic market. Apple’s iPhone, first released in 2007, was available in Korea only in 2009 due to complicated certification procedures and protests by local handset makers.

It is a serious matter if the power of big local players played a part in halting the sale of Xiaomi phones. If Korean companies cannot be confident of their technology on their home turf, how capable are they in competing on the global stage? Such protective actions are not suited to the era of free trade.

Consumers must be able to choose good products at diverse price ranges regardless of where those products are manufactured. Companies should stop appealing to patriotism of local consumers and instead try to win through fair competition and innovation.

JoongAng Ilbo, Jan. 7, Page 30