S5 launch may be hampered by regulator action

Flagship’s April debut coincides with handset sales, upgrade bans on major carriers

Tags: Samsung Electronics CompanySouth Korea
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S5 launch may be hampered by regulator action The bans will prevent South Korea’s top three carriers from offering the S5 to new subscribers or as an upgrade to existing ones.
By  Stephen McBride Published  March 10, 2014

Samsung's Galaxy S5 debut could suffer dampened sales as its domestic launch coincides with handset sales bans imposed on South Korea's carriers by its regulator, Reuters reported.

SK Telecom Co Ltd, KT Corp and LG UPlus Corp operate in a market where smartphone penetration has reached 70%. All three carriers broke industry rules by subsidising handset costs by more than KRW270,000 ($250).

"The Korean market accounts for a relatively small portion of Samsung's overall smartphone sales, but given that they need to maximise sales in the first three months of the launch, the operation suspension of mobile carriers could hit initial S5 sales," said IM Investment & Securities analyst Lee Min-hee.

Some 20m Galaxy S4s sold within three months of its 2013 launch. Its flagship successor has few real standout features that would allow it to appeal to such a saturated market as South Korea, and the bans are likely to still be in effect on 11 April when the S5 goes on sale in its home market.

South Korea's largest operator by subscribers, SK Telecom, is barred from selling handsets to new customers, and from upgrading phones for service contracts that are less than two years old, from April 5 to May 19.

KT's ban lasts from March 13 to April 26, and LG UPlus has been banned from March 13 to April 4 and from April 27 to May 18.

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