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Foreign handset makers eye Korea

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Published : 2014-07-21 20:15
Updated : 2014-07-21 20:15

Foreign smartphone makers are eyeing the domestic market, which has so far been nearly impenetrable due to strong local brands.

Experts say that although the foreign brands may not perform impressively in the short term, they may gain more popularity down the road as more users become attracted to the lower prices and unique designs.

Sony, Acer and Asus already launched smartphones in the domestic market over the last couple of months, with prices ranging between 160,000 won and 350,000 won ($155 and $340). They are around one-third of the price of smartphones from Samsung Electronics and LG Electronics this year. Some local customers are also purchasing phones online that have not yet officially been launched here, by brands such as Motorola, HTC and Xiaomi.

“As the law to control excessive smartphone subsidies is scheduled to be enforced this October, more local users may opt for budget smartphones made by foreign firms in the future,” said Kim Sung-ok, a senior researcher at the Korea Information Society Development Institute.

They may want to look for low-priced handsets with less-common functions and designs, as the local brands have not rolled out any surprises recently, Kim said.

All of this indicates that the perception of foreign brands, especially those from China, is slowly changing in Korea.

“In the past, South Korean users tended to view the IT devices from China as cheap, low-quality products. However, the perception is changing, partly because the local media has become more favorable toward Chinese companies such as Xiaomi,” she said.

Other factors include the fact that Chinese devices have caught up considerably in terms of quality, experts added.

Chinese companies including Huawei, Lenovo, ZTE and Xiaomi are expected to hit the domestic market, albeit not in the near future.

When they do, Huawei, which already has a presence in Korea as a telecom equipment supplier, could be the first. With a large amount of capital, the company can afford to take a risk in the attractive, tech-savvy local market.

Currently, the combined market share of Samsung Electronics, LG Electronics and Pantech is over 90 percent in South Korea, with that of Apple’s iPhone series hovering around 5 percent.

By Shin Ji-hye (shinjh@heraldcorp.com)

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