South Korea's No. 3 mobile carrier LG Uplus Corp. said Tuesday that it will exclusively distribute a budget smartphone released by China-based Huawei, a move that may signal a further setback for local manufacturers already facing challenges from Chinese brands.
  

The Y6 smartphone, which comes with a price tag of 154,000 won ($130.2), can be free if a user subscribes to a monthly plan of 30,000 won or higher, LG Uplus said.
  

The 5-inch smartphone comes with a 2,200 mAh removable battery along with 2-megapixel and 8-megapixel cameras. It runs on Android Lollipop 5.1 and comes in two colors -- black and white.
  

LG Uplus also released the 5-inch X3, a localized version of what's known as Huawei's Honor 6 in overseas markets, in 2014.
 
 
Local mobile carriers have been getting ready to roll out budget smartphones in line with the booming popularity of affordable options after the government banned service providers from offering excessive discounts to attract each others' users last year.
  

The rising demand for budget smartphones has also dealt a harsh blow to Samsung Electronics Co. and LG Electronics Inc., especially as they have already been challenged by Chinese players armed with price competitive devices in overseas markets.
  

Samsung's IT and mobile business posted an operating profit of 2.4 trillion won, slightly lower than the previous quarter's 2.7 trillion won.
  

Industry watchers said that the rising portion of budget smartphones, along with the increasing presence of Chinese firms, ate into its profitability.
  

LG Electronics' mobile communications business, which covers smartphones, also posted an operating loss of 77.6 billion won in the third quarter, compared with an operating income of 200 million won in the second quarter and a profit of 168.6 billion won a year earlier. (Yonhap)