Samsung Electronics

Samsung fails to stop S5 phone's early release

PUBLISHED : Friday, 28 March, 2014, 1:40am
UPDATED : Tuesday, 11 October, 2016, 1:04pm

Samsung Electronics failed to keep its new Galaxy S5 smartphone from going on sale early in South Korea yesterday as SK Telecom and other carriers try to work around penalties imposed by the national regulator.

The world's largest mobile phone maker planned to release the phone on April 11, yet that date would be in the middle of state-imposed suspensions preventing SK Telecom and KT from doing business. LG Uplus' suspensions surround that date.

Samsung is getting drawn into a battle among South Korean carriers for users, with illegal discounts prompting the government regulator to limit their ability to sign up new customers for 45 days. Samsung is counting on the marquee device to maintain its lead in a global smartphone market where it competes with Apple for high-end shoppers and Chinese producers including Xiaomi target budget buyers.

"We are very puzzled," Samsung said in a statement. "SK Telecom strongly asked for an earlier release of the product but we delivered our stance that the global release date of April 11 remains unchanged."

"We decided to release the product for a wider consumer choice of handsets before our operation suspension begins on April 5," Irene Kim, a spokeswoman for SK Telecom, said.

Consumers were able to start buying the Galaxy S5 for 866,800 won (HK$6,244) from SK Telecom's 3,000 retail stores and website from yesterday, South Korea's largest carrier said. Existing customers of KT and LG Uplus can purchase the device under certain conditions, the companies said.

The Ministry of Science, ICT and Future Planning said on March 7 it would ban SK Telecom from signing up new customers and from offering phones to users who want to change their devices without certain conditions for 45 days starting on April 5. Second-ranked KT currently is banned until April 26, while restrictions on LG Uplus are in place until April 4 and then resume April 27.

The new Samsung device enters a smartphone market where global growth is expected to slow to 6.2 per cent in 2018 from 19 per cent this year, research firm IDC said last month.

"Unlike the early stages of the domestic smartphone market, the power is now equally balanced between carriers and handset makers because so many handsets are in the market now," said Kim Jang Won, a Seoul-based IBK Securities analyst said.

Samsung unveiled the S5 at Barcelona's Mobile World Congress in February, choosing a more low-key stage for the device than it did a year earlier with the S4's gala at New York's Radio City Music Hall. The company sells one of every four mobile phones in the world.

The Galaxy S5 has a fingerprint reader with a full high-definition 5.1-inch display on an active-matrix organic light-emitting diode screen. The back of the phone has a leather feel while the device is designed to withstand 30 minutes at the bottom of a metre-deep pond. The main camera has a resolution of 16 megapixels, compared with 13 megapixels on the S4 model, and the battery will last 20 per cent longer than its predecessor, Samsung has said.

Samsung had 29.1 per cent of global smartphone shipments in the December quarter, compared with 17.6 per cent for Apple and 5.7 per cent for third-place Huawei Technologies, according to IDC data.

Apple's iPhone 5s, which went on sale in markets including China, Japan and the US on September 20, has fingerprint-reading technology.