Scheduled removal of handset subsidy ban expected to reshape telecom industry

The long-contested ban on handset subsidies is set to be lifted this week, 11 years after it was introduced, in what many view as a move that will promote competition in the local market and reshape the mobile industry landscape. The revised Mobile Device Distribution Improvement Act will take effect Tuesday, effectively removing the ban on excessive discounts or subsidies by mobile carriers, which was first placed in 2014. The law was intended to curb chaotic subsidy competition among carriers and retailers, who had flooded the market with various incentives to lure customers into buying premium smartphones. Before the ban, information asymmetry had been a key concern. Savvy consumers who compared retail shops or negotiated well could secure generous deals, while elderly or less-informed customers often paid more and received the least in subsidies at official stores. Under the regulation, telecom companies have been required to announce an official cash subsidy for each mobile handset model, with retail shops allowed to offer only up to 15 percent of that subsidy in additional incentivWeiter zum vollständigen Artikel bei Korea Times Weiter zum vollständigen Artikel bei Korea Times