Subsidies for Device Purchases Reach 750,000 Won Last Month
Up 80,000 Won Compared to February This Year
At the end of July, the "Act on Improvement of Distribution Structure of Mobile Communication Devices" (commonly known as the Mobile Communication Subsidy Restriction Act) was abolished. However, there have been criticisms that the intended purpose of the repeal has been undermined, as the subsidies for purchasing mobile phones have only increased slightly.
On July 21st, a signboard reading "Repeal of the Mobile Phone Subsidy Restriction Act" was placed in front of a mobile phone store in Seoul.
According to an analysis of the subsidy status survey submitted by the Korea Communications Commission to Assemblywoman Choi Sujin of the National Assembly's Science, ICT, Broadcasting, and Communications Committee on October 9, the subsidies provided by telecom companies to device purchasers stood at 750,000 won as of last month, following the repeal of the Act. This amount is about 80,000 won higher than the 669,000 won in device subsidies recorded in February this year. Compared to the average subsidy of 730,000 won during the heated competition in the telecommunications market caused by the SKT hacking incident just before the Act was repealed in June, the increase is only 20,000 won.
The Korea Communications Commission uses a "mystery shopping" method, in which survey personnel visit telecom retail stores disguised as actual consumers to collect sample data on the offered subsidies.
Looking at the monthly subsidy trends: 669,000 won in February, 662,000 won in March, 682,000 won in April, 699,000 won in May, and 733,000 won in June, the amount continued to rise. However, after the repeal of the Act in July, the increase slowed, with 758,000 won in July, 747,000 won in August, and 750,000 won in September. Nevertheless, while the average subsidy paid at mobile phone stores in the Seoul metropolitan area at the beginning of this year was 690,000 won and in non-metropolitan areas was around 630,000 won, as of last month, the average subsidy in the metropolitan area reached 750,000 won and in non-metropolitan areas 740,000 won, effectively narrowing the gap between regions.
By telecom company, LGU+ offered the highest average subsidy at 757,000 won, followed by KT at 755,000 won, and SKT at 739,000 won. From February to last month, the average subsidies by device type were 840,000 won for iPhones, 740,000 won for Galaxy premium models, and 420,000 won for Galaxy mid-range models.
Assemblywoman Choi Sujin emphasized, "After the repeal of the Act, the authorities must actively step in to ensure that telecom companies compete properly on service fees."
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