Samsung Sanctioned Four Years After GOS Controversy Over "Galaxy Phone Performance Throttling"; Fined 20 Billion Won

Promoted as the "ultimate gaming experience," while secretly throttling performance
KFTC: "Clear-cut unfair advertising that concealed restrictions"

The Korea Fair Trade Commission (KFTC) has imposed a fine in the 20-billion-won range on Samsung Electronics for exaggerating the gaming performance of its smartphones and deliberately limiting their speed. Four years after the “Game Optimizing Service” (GOS) controversy, in which Samsung promised “the best performance ever” amid the rise of high-end mobile gaming but then forcibly throttled performance to conceal device overheating, the commission has cracked down on the company over deceptive labeling and advertising.

Three models in the Samsung Galaxy S21 series. Yonhap News.

The KFTC said on October 27 that it had decided to impose corrective orders on Samsung Electronics for unfair advertising and a provisional fine of about 20 billion won. The last time Samsung Electronics was sanctioned by the KFTC for unfair advertising was about eight years ago, in a 2018 case involving exaggerated claims about air purifiers. In that case, the KFTC imposed a fine of 488 million won, finding that the company had misled consumers with promotional claims such as “removes 99.9% of viruses” without specifying the conditions under which the claim had been tested.

According to the KFTC, Samsung Electronics extensively promoted the gaming performance of its devices while selling the Galaxy S21, S22 and Tab S8 series from January 2021 to March 2022. In reality, however, the devices were designed to immediately activate “GOS individual policies” whenever consumers launched certain high-end game apps, regardless of the device’s condition, including its temperature. As a result, the maximum operating speeds of the central processing unit (CPU) and graphics processing unit (GPU), key components of the devices, were forcibly reduced to as low as 30% of their original maximum performance. Screens frequently froze or resolution dropped at moments when high performance was needed, leaving consumers with only compromised performance despite paying high prices.

The problem was that Samsung Electronics never informed consumers of these facts and instead stepped up its high-performance marketing. The company emphasized the devices’ ability to run high-end games with claims such as “the fastest 5-nanometer AP ever in a Galaxy” and “the ultimate mobile gaming experience.” The KFTC concluded that Samsung’s failure to disclose the performance restrictions amounted to “deceptive labeling or advertising” under Article 3(1)(2) of the Act on Fair Labeling and Advertising, even though consumers could have chosen other options had they known about the restrictions in advance.

The related sales of the three models during the period of the legal violation amounted to about 4 trillion won. At the initial review-report stage, the violation was considered serious, and a fine in the 60-billion-won range was expected. During the commission’s deliberations, however, the violation was downgraded to a less serious category, reducing the applicable rate to 0.5%. This reflected Samsung’s “prompt voluntary correction” after consumer complaints surged: the company later opened a workaround through a software update and lifted the performance restrictions. Asked why it took four years after the GOS controversy for the sanction to be announced, the KFTC said, “The process took time because the respondent was given more than 11 opportunities to submit explanatory materials, and we also conducted preliminary opinion-hearing procedures to fully consider the validity of its explanations and claims on technical issues.”

Lee Sun-mi, a standing member of the KFTC, said, “The significance of this measure is that it confirms that when a company advertises a particular product performance as a key feature, it must clearly indicate any important limitations affecting that performance so that consumers can understand them, if those limitations differ from the impression conveyed through the advertising.” She added, “The KFTC plans to continue monitoring unfair labeling and advertising to ensure that information that could significantly affect consumers’ rational purchasing decisions is accurately provided, while promoting fair competition and working to create a transaction environment consumers can trust.”

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