SKT, KT and LG U+ hike Galaxy S24 benefits after government lifts cap

Industry

Published: 06 Feb. 2024, 16:44

SKT, KT and LG U+ hike Galaxy S24 benefits after government lifts cap

Galaxy S24 series devices are on display at Samsung Gangnam, southern Seoul on Jan. 31. [YONHAP]

Each of Korea's three major mobile carriers — SK Telecom (SKT), KT and LG U+ —raised subsidies for the Galaxy S24 series on Tuesday after the government lifted a smartphone subsidy cap.

Mobile carriers are now offering subsidies between 55,000 won ($41.33) and 500,000 won for a new Galaxy S24 device, staggered to a user's mobile plan, according to industry sources.

The government previously capped carrier subsidies at 240,000 won.

Some mobile retailers are offering additional subsidies — at 15 percent of the carrier's. Thus, consumers can receive a combined benefit of 63,250 won to 575,000 won.

LG U+ is the most generous carrier, with a benefit cap set between 155,000 won and 500,000 won.

SKT's subsidies now range from 250,000 won to 489,000 won, up from 150,000 won to 289,000 won at the beginning of the network's Galaxy S24 service on Jan. 26.

KT also upped benefits for users with 5G plans.

KT’s subsidies sit between 55,000 won and 480,000 won. Benefits for KT users on “5G Choice Premium Plan” paying 130,000 won for a monthly bill increased by 240,000 won. KT's previous benefits started at 50,000 won and ended at 240,000 won.

Customers who made pre-orders for Galaxy S24 series wait in a queue to receive their devices at Samsung Gangnam on Jan. 28. [NEWS1]

The subsidy expansion comes after the government decided to abolish the Mobile Device Distribution Improvement Act last month.

The law was criticized for barring consumers from lower phone prices while allowing mobile carriers to snatch up government subsidies.

The government added that the Telecommunications Business Act will govern selective discounts, which cut 25 percent from the monthly bill for a contracted time.

Potential users of the Galaxy S24 Series have two discount options: receiving a one-off subsidy or a selective discount.

The Korea Communications Commission called to expand subsidy benefits after inviting three mobile carrier companies’ officials and executives at Samsung Electronics to the authority last month.

The second Vice Minister of Science and ICT, Park Yun-kyu, also sought cooperation with the Galaxy S24 maker to alleviate phone bill burdens.

“If a certain mobile carrier hits the ground running, others usually follow like a bandwagon effect,” an industry official said. “However, as the unprecedented discount level could ignite the fairness issues with competing carriers’ consumers, the discounts offered through the subsidy will not surpass that of the selective monthly discount.”

According to the commission’s guidelines on posting subsidies, mobile carriers can change the amount of subsidies on Tuesday and Friday.

The rule mandates those carriers to specify the device types, the discount offered via subsidies and the final cost, including value-added taxes.

BY LEE SOO-JUNG, LEE HAY-JUNE [lee.soojung1@joongang.co.kr]