[Report] "LG Phone AS Available" Sales Stores Struggle... 5G Latest Phones Almost Free

Few Customer Inquiries About LG Phones
Only Some Enthusiasts Inquire
Considering Expanding Marketing Support
To Clear Inventory of the Three Major Carriers

On the afternoon of the 5th, when LG Electronics officially announced its withdrawal from the smartphone business, a notice about a special sale of LG Electronics' latest smartphone, the LG Wing, was posted on the wall of an LG Uplus agency in Yeongdeungpo-gu, Seoul.

[Asia Economy Reporter Cha Min-young] "LG Electronics is not shutting down completely just because they are exiting the smartphone business. As long as the product is not older than five years, after-sales service (AS) is still available, so customers don’t need to worry."

At around 6 p.m. on the 5th, I visited an LG Uplus agency in Yeongdeungpo-gu, Seoul. Various latest smartphones were prominently advertised on the glass window as being on special sale. The LG Wing, which was priced at 1,098,900 KRW at launch last October, has now become a free phone with an actual purchase price of just 90,000 KRW. Since January, with official subsidies of up to 600,000 KRW and additional card partnership discounts, the price of unlocked smartphones has dropped to the 400,000 KRW range.

When inquiring about the LG Wing, the agency staff took out the product and explained several features. They also mentioned that the unique form factor is good for watching videos. When asked about AS, the staff said, "At the LG Digital Service Center, they stock multiple parts for each new product, and they are all the same." However, the staff admitted they did not know specific details about software upgrades or the duration of AS services.

At the same time, the scene was similar at Sindorim Technomart, known as the so-called ‘smartphone sanctuary.’ Perhaps because it was a weekday evening, the more than 100 stores appeared quiet. When asked about LG Electronics smartphones, the staff at the counters looked puzzled. One employee said, "Whether it’s unlocked or device replacement, no customers ask about LG products," adding, "Most customers who come here usually ask about iPhones, and sometimes the Galaxy series (Samsung)." Another employee said, "There are requests to recommend free phones, and if Samsung and LG are options, the atmosphere is naturally to choose Samsung," hinting, "Customers who have seen LG phone news seem to be more reluctant to buy this year due to AS difficulties."

However, among some phone enthusiasts, visits to find popular models like the LG Wing and LG Velvet have increased. They regularly visit to take advantage of the season when stock clearance begins to purchase at cheaper prices. Online communities predict that the secondhand market price for LG Wing unlocked phones could drop to the 200,000 KRW range. The previous market price, which was around 400,000 to 500,000 KRW, has fallen to the low 300,000 KRW range since LG Electronics announced its smartphone exit.

As of the previous day, looking at the official subsidy status for major 5G smartphones from the three major carriers, the highest official subsidy for the V50 (730,000 KRW) is already close to the launch price (ranging from 899,800 to 752,000 KRW depending on the carrier). Including additional retailer subsidies (15% of the official subsidy), some carriers have effectively made these ‘zero-won phones’ or ‘fare phones.’

The three carriers are considering expanding marketing support for LG Electronics’ latest smartphones. A carrier official said, "We have been preparing related plans even before the official exit announcement," and added, "We are reviewing stock clearance plans." Another carrier official said, "We have been clearing some stock since the beginning of the year," and "We will continue marketing support for remaining stock depending on market conditions."

Regarding the used phone trade-in program, it is reported that no specific guidelines have been delivered to agencies. The trade-in program allows customers to return smartphones used for 24 months and upgrade to premium devices from the same manufacturer at up to 50% discount. However, since the options are limited to the V and G series, customers are facing difficult choices. A KT direct store employee said, "No instructions from headquarters have come down regarding the used phone program," and added, "Customers may be frustrated, but currently, there is nothing we can explain."

Samsung Electronics, Xiaomi, and others are expected to expand their zero-won phone campaigns focusing on mid- to low-priced smartphones to fill the gap left by LG phones. A representative example is the Galaxy A42, which was recently launched at 449,900 KRW; its official subsidy was significantly increased, and within less than a month, its lowest actual purchase price dropped to zero. Chinese Xiaomi also lowered the launch price of the Redmi Note 10 and increased official subsidies, presenting it at a zero-won actual purchase price.