Samsung Galaxy S5 Release Coincides With Korean Phone Sales Ban

Mar 10, 2014 10:00 AM EDT | Matt Mercuro

A 45-day ban in South Korea on local carriers selling phones could cause Samsung's Galaxy S5 to get off to a slow start once it's released.

The Galaxy maker plans to start global sales for the S5 on April 11, and South Korea is usually one of the first locations to get Samsung's latest devices.

This may not happen however, since a communications regulator banned SK Telecom Co. Ltd., KT Corp and LG Uplus Corp. from signing up customers or replacing phones for dates ranging from March 13 to May 19, according to Reuters.

The carriers had broken regulations by subsidizing over 270,000 won ($250) which is the cost of handsets.

"The Korean market accounts for a relatively small portion of Samsung's overall smartphone sales, but given that they need to maximize sales in the first three months of the launch, the operation suspension of mobile carriers could hit initial S5 sales," said IM Investment & Securities analyst Lee Min-hee.

The ban could cause S5 sales in the first three months to fall short of the 20 million S4 devices sold within three months of its launch, according to Lee.

The launch will be two weeks earlier than when the S4 was sold since sales of the predecessor have been weaker than analyst originally believed, according to Reuters.

Samsung has refused to comment on the impact of carriers' sales ban, and it has yet to decide when it will start selling the S5 in South Korea.

SK Telecom, the country's biggest carrier by subscribers, has been banned from signing up and selling phones to new customers and upgrading phones were service contracts are less than two years, from April 5 to May 19, according to Reuters.

Second-placed KT has been banned from March 13 to April 26.

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