Three Major Telecoms Offer Switching Subsidies Around 300,000 KRW
Comparing Samsung Galaxy S23 Models
Condition: Maintain 100,000 KRW Plan for 6 Months
The three mobile carriers have raised the 'switching subsidy,' which provides a one-time discount on device prices for number portability customers, to a maximum of around 300,000 KRW. This comes just one day after the Korea Communications Commission summoned the representatives of the three carriers. However, to receive the switching subsidy in the 300,000 KRW range, customers must maintain a 100,000 KRW-level plan for six months, leading to unavoidable criticism of it being a 'case of rearranging the deck chairs.'
On the 22nd, at the Press Center in Jung-gu, Seoul, Kim Hong-il, Chairman of the Korea Communications Commission, and related officials are taking a commemorative photo at the meeting between the Chairman of the Korea Communications Commission and CEOs of telecommunications companies and device manufacturers. From the left: No Tae-moon, President of Samsung Electronics; Hwang Hyun-sik, CEO of LG U+; Kim Hong-il, Chairman of the Korea Communications Commission; Yoo Sang-young, CEO of SK Telecom; Kim Young-seop, CEO of KT; Ahn Cheol-hyun, Vice President of Apple Korea. Photo by Joint Press Corps
The day after meeting with the KCC Chairman, switching subsidies sharply increased to around 300,000 KRW
On the 23rd, LG Uplus, SK Telecom, and KT raised the switching subsidies for number portability customers to a maximum of 300,000 KRW, 320,000 KRW, and 330,000 KRW, respectively. This is about ten days after the KCC issued a notice allowing switching subsidies up to 500,000 KRW. Initially, the switching subsidies offered by the three carriers remained in the 100,000 KRW range, sparking debates about the effectiveness of the policy.
In response, the day before, KCC Chairman Kim Hong-il called in the representatives of the three carriers and manufacturers to request cooperation on the switching subsidy policy. Attendees included Yoo Sang-young, CEO of SK Telecom; Kim Young-seop, CEO of KT; Hwang Hyun-sik, CEO of LG Uplus; No Tae-moon, President of Samsung Electronics; and Ahn Cheol-hyun, Vice President of Apple Korea.
Must maintain high-priced plan for 6 months... Subsidies drop sharply for latest phones
The business leaders expressed their willingness to cooperate with the government’s policy, and on the 23rd, they abruptly announced the expansion of switching subsidies.
LG Uplus took the lead by posting a notice on its website about raising the switching subsidy up to 300,000 KRW. Customers who port their number and subscribe to the 5G Premier Regular plan (monthly base fee of 95,000 KRW) and maintain it for six months can receive a 300,000 KRW switching subsidy for the Samsung Galaxy S23 series. However, for the latest AI-enabled smartphone, the Galaxy S24, even subscribing to the most expensive plan only yields a maximum switching subsidy of 60,000 KRW.
LG Uplus announced on the 23rd that it will provide a conversion subsidy of 300,000 KRW for the 'Samsung Galaxy S23 Ultra' model to customers who have switched their numbers and subscribed to the 5G Premier Regular plan (monthly base fee of 95,000 KRW). [Source=LG Uplus website]
SK Telecom set its maximum switching subsidy at 320,000 KRW, 20,000 KRW higher than LG Uplus. However, the condition is maintaining the 5GX Platinum plan, which costs 125,000 KRW per month, for six months. The eligible devices are limited to last year’s models such as the Galaxy S23 series. For the Apple iPhone 14, even subscribing to the most expensive plan results in a switching subsidy of only 220,000 KRW.
KT joined the switching subsidy expansion last. It set the maximum subsidy at 330,000 KRW, 10,000 KRW higher than SK Telecom. However, the range of eligible devices is narrow. The Galaxy S23 series is not included at all, and for the Galaxy S24, the switching subsidy drops sharply to 80,000 KRW. The devices eligible for the 330,000 KRW subsidy are limited to the Galaxy S22 series and Galaxy Z Flip4 and Fold4. This is also conditional on maintaining the Choice Premium plan, which costs 130,000 KRW per month, for six months.
SK Telecom announced on the 23rd that it will provide a conversion subsidy of 176,000 KRW for the 'Samsung Galaxy S 23 Ultra' model to customers who switch their number and subscribe to the 5GX Prime plan (monthly base fee of 89,000 KRW). [Source=SKT website]
Ultimately, the interpretation is that consumers must give up purchasing the latest smartphones and use expensive plans for a long period when switching carriers to receive higher switching subsidies.
This explains why CEO Hwang Hyun-sik’s remarks that switching subsidies could actually increase communication costs are gaining traction. After the shareholders’ meeting on the 21st, Hwang told reporters that the switching subsidy policy "needs further discussion" and expressed concern that "if handled improperly, it might lead to an increase in national communication expenses."
He was worried about side effects such as the loss of long-term subscriber benefits when switching carriers after receiving the subsidy, and 'phone inflation,' where only expensive phones are preferred, which could increase actual communication expenses.
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