“We offer the 'iPhone 16' for 90,000 won.”
On the evening of the 30th, at Techno Mart 9th floor in Sindorim, Seoul, an employee at Mobile Communication A’s distribution point noted, "Since the abolition of the Device Subsidy Regulation, it seems that the additional subsidies, excluding the standard support, have increased by about 300,000 to 400,000 won," adding, "However, you must subscribe to a plan of over 100,000 won for six months and there are conditions to change the number to another carrier."
On the 26th, the bill to abolish the Device Subsidy Regulation (the Act on Improvement of the Mobile Communications Device Distribution Structure) passed the National Assembly. Contrary to expectations that subsidies would significantly increase, benefits were still concentrated only on some high-priced plans.
◇ Apple 'iPhone 16' for just 90,000 won
When inquiring about the iPhone 16 (128GB) and Galaxy S24 Ultra (256GB) models at a distribution point, the seller entered the numbers '9' and '31' on the calculator. When asked, "Does this mean that if you buy the iPhone 16 and Galaxy S24 Ultra, you will receive additional subsidies of 90,000 won and 310,000 won, respectively?" the employee replied, "It means that if you pay this price in cash, I will sell you the products."
The manufacturer's suggested retail price for the iPhone 16 (128GB) is 1,243,000 won. The standard support you can receive when subscribing to a monthly plan around 100,000 won through the three telecom companies is 450,000 won. Additionally, the maximum additional subsidy that the distribution seller can provide (15% of the standard support) is 75,000 won. However, on that day, the additional subsidy was as high as 700,000 won. Thus, if you subtract the standard support and additional subsidies from the manufacturer's price, the price effectively drops to 93,000 won.
The Galaxy S24 Ultra (256GB) has a manufacturer's suggested retail price of 1,698,400 won, with a standard support of 500,000 won and additional subsidies from the distribution point amounting to 880,000 won. After these amounts are deducted, the actual purchase price dropped to 318,400 won. I visited four more nearby stores, and the price differences were about 30,000 to 50,000 won, with most offering similar prices.
Although the bill to abolish the Device Subsidy Regulation passed this month, the actual abolition is set for six months later. Under the current law, to purchase these products while receiving standard support and an additional 15% subsidy from the distribution point, one must pay about 670,000 won for the iPhone 16 and about 1,120,000 won for the Galaxy S24 Ultra. A Ministry of Science and ICT official said, "While the Device Subsidy Regulation will be abolished in six months, it is an inevitable situation where the regulations of the Korea Communications Commission will inevitably become lax in the process of practically phasing it out."
◇ Concerns about support concentration for high-priced plans following Device Subsidy Regulation abolition
Distribution points that offer additional subsidies over 700,000 won all require subscribers to a high-priced plan of over 100,000 won for more than six months and to change their number to another carrier.
When I asked about the standard support and additional subsidies for subscribing to mid-low price plans below 50,000 won, the response was that the amount provided isn't large. The telecom companies' standard support was below 300,000 won, leading to a difference of about 200,000 won compared to plans costing around 100,000 won, and there were nearly no additional subsidies. An employee at store B explained, "If you subscribe to a plan below 50,000 won, the additional subsidy won't even reach 100,000 won," adding, "The telecom companies have set significant rebates for high-priced plans exceeding 100,000 won, so it is advantageous to first subscribe to a high-priced plan and switch to another plan after six months."
Shin Hyun-doo, head of the Korea Consumer Agency, expressed concern, saying, "I worry that the abolition of the Device Subsidy Regulation may exacerbate the discrimination against customers on mid-low priced plans as telecom companies drastically increase support for high-priced plans."