Galaxy S24 for free? How Korea's new subsidy schemes could make it possible

TL;DR:

• Subsidies for number portability in South Korea are discussed
• There was a cap for “regular” subsidies when buying a carrier phone, but the cap was lifted
• The start price of a Galaxy S24 is 1.155 million KRW, which is what both subsidies amount to

There’s an article in the Korean Ajunews, titled:



A rough translation of the report claims that this is possible after changes to the Mobile Device Distribution Improvement Act, aiming to lower household communication costs.

Changing mobile carriers (number portability) in South Korea now comes with the potential to receive an additional support of up to 500,000 KRW (South Korean won; 500,000 KRW are approximately $380) on top of “regular” subsidies. Until not so long ago, there was a cap for such “regular” subsidies (applied when purchasing a device through national carriers), but it was recently lifted.

Prior to the change, the government capped carrier subsidies at 240,000 KRW (~$180). Mobile carriers in South Korea are now alluring users with subsidies between 55,000 KRW ($42) and 500,000 KRW for a new Galaxy S24 device and a mobile plan.

The biggest change is, of course, the provision of transition support funds. Korean carriers could now pay up to 500,000 KRW in transition support funds covering cancellation fees, SIM card issuance costs, and loss of long-term subscription benefits when changing rival plans.

Considering this, if one were to port their number and purchase a Galaxy S24, they could receive support totaling up to 1.15 million KRW in these new funds: “regular” subsidies and “transition” subsidies. Notably, some mobile retailers are offering additional, even higher subsidies at 15% of the carrier's, thus making in to 1.15 million KRW in total support. Since the base Galaxy S24 model is priced at 1.155 million KRW, it could essentially become a 'free phone'.

Kim Hong-il, Chairman of the Korea Communications Commission, emphasized that these amendments aim to reduce the financial burden on consumers and encourage a more competitive market. However, whether this will invigorate true competition remains uncertain, as carriers show hesitance towards heavy subsidy investments.