Samsung And SK Free Marketing– Galaxy S5 Scandal

Ok, from what little information available on the Samsung Galaxy S5 scandal, we are told that SK, a Korean mobile network service provider, has “puzzled” Samsung by selling the Galaxy S5 two weeks premature to the official release date. But not everything adds up.

READ ALSO: Samsung Galaxy S5 Vs. The Competition

SK – Korea’s Biggest Mobile Service Provider

SK has had over half of the telecommunication market share as far as we can remember. It is the biggest, and has millions of long-term subscribers. So why play cheap tactics like this? Well one reason would be that they would like to win over their customer’s loyalty even more, by special treatment, and to attract more business.

Playing A Stagnant Game

All three major telecom companies, SK, KT, and LG Uplus, have maintained a steady market share around 50.5%, 31.5%, and 18%, respectively. Spending on marketing to increase market share by 0.1% would cost hundreds of billions of Won.

The Fierce Competition

In 2010, KT increased their market share by a shocking 0.3%, by becoming the only iPhone provider in all of Korea. SK felt threatened by this, and aggressively gave out unlimited data plans to consumers. SK has been unable to respond to such threats for a while now, as they have spent all of their cash on acquiring Hynix, and are planning to buyout Japan’s Elpida Memory.

A Hero In the Eyes Of The People

SK might have resorted to this out of desperate competition, but they came out saying they did it for their customers. Meanwhile, Samsung enjoyed the media attention this scandal received. As for the punishment, SK, KT and LGUplus are not allowed to sell products for 45 days, but this is organized in a way that allows SK to continue selling the Samsung Galaxy S5 for now.