Galaxy S26 Now "Free" Just Two Months After Release... Fierce Subsidy Battle Among Three Major Carriers

Subsidy Increases Accelerate, Reaching Up to 700,000 Won
Aggressive Marketing Follows Dantong Act Repeal and Hacking Fallout
“Holy Grail” Retailers Offer Additional Subsidies, Effectively Making Devices Free

The Galaxy S26 series, Samsung Electronics' flagship smartphone released in March this year, has become a so-called "free phone" within just over two months, as consumers can now purchase it with more than half of the original price covered. This is the result of increasingly fierce competition among the three major mobile carriers to attract customers following the abolition of the Mobile Device Distribution Improvement Act (commonly known as the "DanTong Law") last year and a series of hacking incidents.

A citizen is comparing Galaxy S26 series products at the Samsung Gangnam store in Seocho-gu, Seoul. Photo by Yonhap News.

According to the telecommunications industry on May 28, the three major carriers more than doubled the standard subsidy for the Galaxy S26 series this month compared to the initial maximum of 240,000 won at launch. Although the amount varies by rate plan, SK Telecom currently provides between 365,000 and 580,000 won, KT offers between 196,000 and 600,000 won, and LG Uplus provides between 305,000 and 700,000 won in subsidies.

When the additional subsidies from distribution agents, determined by the chosen rate plan and contract period, are combined, the base model (256GB), which has a retail price of 1,254,000 won, can be purchased for 0 won. In fact, some customers even receive cash back. Some so-called "hot spot" retailers are offering up to 620,000 won in cash back if the buyer also meets certain credit card usage requirements. Even the Ultra model can yield a net cash back under the right conditions.

Industry insiders attribute this situation to several factors: the Galaxy S26 series launched at a higher price than its predecessor, consumer sentiment remains subdued, and mobile carriers are aggressively competing to win back subscribers lost due to the hacking incidents. The abolition of the DanTong Law has eliminated caps on subsidies, enabling carriers to launch bold, aggressive marketing campaigns with large-scale subsidy offers.

Mobile carriers' logos. Photo by Yonhap News

In the first quarter of this year, the three major carriers spent a total of 2.0423 trillion won on marketing, a 9.4% increase compared to the same period last year (1.867 trillion won) before the DanTong Law was abolished. By carrier, SK Telecom spent 740.8 billion won, KT spent 687.3 billion won, and LG Uplus spent 614.2 billion won. One industry official stated, "The pace of subsidy increases is faster than ever. Even though the cost burden is rising, no carrier can afford to fall behind in the subscriber acquisition race, so when one carrier raises its subsidies, the others follow suit." In particular, KT and LG Uplus show a significant gap in subsidies between high- and low-priced rate plans, focusing their support on customers who subscribe to premium plans to maximize marketing efficiency.

KT is also providing the highest level of subsidies among the three carriers for Apple's iPhone 17E, which was officially released on the same day as the Galaxy S26 series. For rate plans in the 60,000 to 70,000 won per month range, the subsidy is between 317,000 and 340,000 won—three to four times higher than SK Telecom's 74,000 to 91,000 won or LG Uplus's 117,000 to 133,000 won. Since a large number of subscribers left in the wake of the hacking incident and KT implemented a penalty refund policy earlier this year, the company is seen as having no choice but to take even more aggressive steps in providing subsidies compared to its competitors.

Samsung Electronics, the manufacturer, is also aggressively expanding its contact points with consumers to maintain sales momentum for its new products. According to market research firm Counterpoint, cumulative sales of the Galaxy S26 series since launch are 15% higher than its predecessor, but the global slowdown in smartphone demand means there is still cause for concern. Another industry official commented, "The average smartphone replacement cycle, which was once just over a year, has now lengthened to more than two years. With SK Telecom and KT temporarily waiving contract termination penalties, a wave of replacements has already occurred. Since it is difficult for mobile carriers to shoulder all the subsidy costs, manufacturers like Samsung also increase incentives to stimulate demand continuously."

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