The hottest items that have been heating up the smartphone market since we rang in the new year are definitely low-cost smartphones released by Samsung and LG.
As the two smartphone makers are jostling to put their cheap (roughly $200) or almost free but high-spec smartphones first on the market, users are busy posting their reviews of Samsung and LG budget smartphones. Then, which smartphone maker’s budget smartphones offer the best value for money
The Samsung Galaxy A5 and A7: mid-range smartphones with premium specs
For a start, let’s take a look at the Samsung Galaxy A5 and A7.
Noteworthy is that the Samsung Galaxy A5 and A7 come bundled with support for Samsung Pay, Samsung’s simple, safe mobile payment service, and fingerprint scanning, two high-end features that were available only on Samsung Galaxy flagship models.
The 5.2-inch Galaxy A5 and 5.5-inch Galaxy A7 5 feature a 5 megapixel front-facing camera and a 13 megapixel rear camera.
The Galaxy A5 and A7 continue the latest Samsung Galaxy design heritage: their metal-and-glass body design reminds us of the Galaxy S6’s premium metal-and-glass design. On top of that, the Galaxy A5 and A7 provide a superior viewing experience with a narrower bezel.
Nevertheless, the Galaxy A5 and A7 are available at surprisingly reasonable prices: 528,000 and 599,500 won (factory-gate prices), respectively.
South Korea’s three major mobile carriers are offering hefty subsidies, making the Galaxy A5 and A7 more affordable. KT offers the most generous subsidies. If users choose KT’s LTE Data 999 monthly payment plan, a maximum subsidy of 317,000 won is up for grabs.
Besides, as mobile phone shops can offer an additional subsidy of up to 47,500 won, users can buy the Galaxy A5 and A7 for 163,500 won and 235,000 won, respectively.
SKT and LG U+ furnish 300,000 won and 181,000 won in subsidies. Subsidies are subject to change on a weekly basis.
The LG K10 is virtually free.
The LG K10 hit the market on Jan. 15, a day after the release of the Galaxy A5 and A7. The launch of the LG K10 was supposed to coincide with that of the Galaxy A5 and A7. LG said delayed delivery caused the schedule change, but some say that LG may have worried about the possibility of the Galaxy A5 and A7 stealing the LG K10’s thunder.
The LG K10 packs a 5.3-inch HD screen with 2.5D curved arc glass. The LG K10 is available in indigo black and white. The K10 is equipped wigh a 13 megapixel rear camera and a 5 megapixel front-facing camera, featuring LG's popular Gesture Shot and Gesture Interval Shot, perfect applications for selfie lovers.
Above all, the K10 is priced at a mere 275,000 won. When it is subsidized by mobile carriers, it is almost free, as a matter of fact.
KT is the most generous mobile carrier here again. When users choose KT’s LTE Data 999 monthly payment plan, KT will offer a subsidy of 275,000 won, which is the K10’s factory-gate price.
SKT and LG U+ will offer up to 240,000 won and 201,000 won in subsidies, respectively. Thus, the LG K10 is likely to be the hottest smartphone for the time being.
Maintaining the traction gained from the launch of the K10, LG is expected to release three more K-series smartphones, the K7, K4 and K5 (a 3G phone), within this year.
What heats up competition in the low-cost smartphone sector
Then, why are Samsung and LG jostling to undercut each other In the smartphone market, some smartphones are so popular that supply sometimes cannot keep up with demand. Therefore, it is hard to understand why subsidies can cover the entire cost of a certain budget smartphone.
Recently, mid- to low-end smartphones have been emerging as lethal weapons in the smartphone market. The nation’s three major telecom operators, SKT, KT and LGU+, have expanded their lineup of mid- to low-end smartphones, competitively dangling subsidies in front of consumers.
The answer is simple: mid- to low-end smartphones are the most powerful source of revenue growth for the three major mobile carriers.
A low-cost smartphone, launched by Huawei on Dec.14, 2015, sold 20,000 units just in one month.
The Huawei Y6 was sold exclusively through LG U+ in South Korea. The Huawei Y6 sold like hotcakes probably because LGU+ offered subsidies that brought the price of the smartphone down to near zero.
Do not jump to the conclusion that the Y6 is nothing but a dirt-cheap, low-spec smartphone. The Y6 has drawn great reviews from users as it sports a 360-degree panorama camera and face recognition technology.
Users opt for high-spec budget smartphones.
Sales of the Runa, launched by TG & Company (an affiliate of Sambo Computer) and sold exclusively through SKT, hit 150,000 units. And 80,000 units of the Galaxy J7 were sold through KT, driving up the mobile carrier’s revenues.
On the other hand, much-anticipated high-end smartphone models, including the Samsung Galaxy 6, Galaxy 6 Edge, Galaxy Note 6, the LG G4 and the Apple iPhone 6S, ended up being nuisances as sales of those smartphones fell far short of expectations.
Of course, such a trend has something to do with the nation's economic downturn. However, it is also true that there has been a shift in consumer perceptions towards buying high-end smartphones.
Consumers wanted to buy the latest and the most expensive smartphone in order to keep up with the Joneses. However, the nation’s new telecom act, which sets a ceiling on subsidies offered by mobile carriers, has limited subsidies for premium smartphones to 330,000 won. As a result, the majority of users would rather trade down to mid-range smartphones (including Chinese smartphones) or switch to a mobile virtual network operator (MVNO) than become “smartphone poor” as long as the budget smartphones of their choice offer the best value for money.
Besides, Huawei and Xiaomi smartphones, which used to be considered as second-rate products, are getting positive reviews from consumers. And as MVNOs have improved their services, budget phones selling at post offices become hard to get. Against such a backdrop, Samsung and LG have taken pains to develop high-spec budget smartphones.
Hence the two electronics giants are projected to continuously vie to roll out low-cost smartphones of decent quality. It remains to be seen whether this cutthroat competition among smartphone manufacturers serve as a boon or bane for smartphone users.
