[Report] The '17' on the Calculator... The Secret of Galaxy S20 Subsidies

Despite COVID-19, Sindorim Technomart Mobile Phone Market Bustling
Device Return Conditions Include Used Device Compensation or Encouragement to Re-purchase in Sindorim After 2 Years
Galaxy S20 Sold at 350,000~400,000 KRW Under Sindorim Re-purchase Condition
Notice States 'Waiving Installments After 24 Months Is Illegal, Consumer Responsibility,' but It's Ignored

[Asia Economy Reporter Han Jinju] '17'. On the 7th, I visited the Sindorim Technomart in Seoul to purchase the Galaxy S20. When I asked, "How much is the Galaxy S20?" an employee at Store A showed me the number on the calculator. It meant 170,000 won. When I made a face as if to say, "Is it that cheap?" the employee explained, "If you purchase the Galaxy S20 on the condition that you return the used device after 2 years, we will support 50% of the price."

At a nearby store, another number popped up: '35'. The condition was different. After purchasing the device, if you replace it with a new one within 3 years and repurchase it at the collective market, it is possible. The store employee explained, "Under the condition of repurchasing after 2 years, the store supports one-third of the original price."

That day, despite the novel coronavirus infection (COVID-19), Sindorim Technomart was bustling with employees and customers wearing masks. Visitors looked around to find stores with many consultation customers, and store employees struggled hard to hold onto customers.

Galaxy S20 for 170,000 won? Beware of Solicitation

Some stores guided that the Galaxy S20 could be purchased for 170,000 to 190,000 won. Although tempting, they were recommending carrier products that offer up to a 50% discount on the original price when subscribing to a used device compensation program. The program that compensates up to 50% of the used device when changing to a new device after 2 years is provided by each carrier. However, caution is needed. Although the device cost burden is low at first, considering depreciation after 2 years, it is not guaranteed to receive compensation up to 50% of the original price.

Stores do not properly inform this during consultations. A store employee urged purchase, saying, "Since it is the initial launch period, there are no carrier promotions other than used device compensation. You just need to use it for 2 years and return it. If you are worried about device damage or loss, you can subscribe to insurance."

Stores explained that the Galaxy S20 could be purchased for 350,000 to 400,000 won under the collective market repurchase condition. A store employee said, "The collective market is a program conducted in partnership with carriers," and added, "If you purchase from another store after 2 years, you may have to pay a 'discount refund,' so please be sure to visit Sindorim."

However, this also has problems. Even if you try to purchase from the same store after 2 years, if the store disappears, you may not receive support. Another store employee confessed, "If the owner changes or the store disappears, you may not receive the subsidy. There is no guarantee that the store will still be there after 2 years."

Intense Competition Due to Meager Subsidies

The overheated marketing disguised as subsidies by stores is becoming increasingly sophisticated. As the fee structure and discount benefits become complicated, consumers lacking information are more likely to respond to solicitation. Cases where offices or sales points without signs secretly reveal their locations and offer subsidies through cashback benefits have also increased.

This phenomenon is largely due to the 'meager subsidies' for the Galaxy S20. The maximum Galaxy S20 subsidies set by the three carriers are ▲SKT 170,000 won ▲KT 243,000 won ▲LG Uplus 202,000 won. Compared to the Galaxy S10 official subsidies of 475,000 to 540,000 won released in March last year, this is less than half. Last year, subsidies soared due to competition to attract new 5G subscribers, but this year carriers are tightening their belts to reduce losses.

An official from the Korea Communications Commission said, "The condition of waiving installment payments after 2 years is an unfounded act, and since the actual contract fulfillment can only be confirmed at that time, it is a type of fraudulent sales, and we are continuously cracking down," adding, "Even if you have opened a contract like this, cancellation of the contract is not possible, so it is risky for consumers to blindly trust and expect it."

This content was produced with the assistance of AI translation services.