Following Samsung Electronics, the government is also getting involved in second-hand phone certification, leading the budget mobile phone industry to expect benefits. This is because it is anticipated that consumers, who had hesitated to purchase second-hand phones due to concerns about personal information leakage, will increasingly sign up for budget mobile phones with lower plans than telecommunications companies.
The Ministry of Science and ICT began operating the 'second-hand phone safe transaction operator certification system (hereinafter referred to as the second-hand phone certification system)' on the 28th. This system was introduced to address issues such as concerns about personal information leakage during second-hand phone transactions. The certification criteria consist of basic requirements for user protection, including the establishment of personal information deletion procedures.
According to a survey conducted by the Korea Institute of Science and Technology Evaluation and Planning (KISDI) with 1,228 respondents, 62.5% of the respondents answered that they are currently storing their most recently discontinued smartphone when asked about how they handle it. This indicates that 6 out of 10 people are keeping their second-hand phones instead of selling them. The main reason for not having sold a discontinued mobile phone is 'concern about personal information leakage,' which was cited by 50.8%.
The industry expects that the second-hand phone market will grow rapidly due to the government-led certification system. According to the Korea Institute of Science and Technology Evaluation and Planning, the number of second-hand phone transactions in the country last year is estimated to be about 9 million. This represents a 32% increase compared to 6.82 million units in 2021. Following Samsung Electronics' launch of 'Galaxy certified second-hand phones' for its returned smartphones last March, the industry anticipates that annual second-hand phone transactions will exceed 10 million when reflecting the impact of the government's implementation of the second-hand phone certification system. An industry official noted, 'Due to the rise in device prices, the relatively inexpensive second-hand phone market is growing, but in Korea, many people are holding onto their used phones without selling them due to concerns about personal information leakage,' adding, 'The active participation of large companies and the government in second-hand phone certification is a positive signal for revitalizing the second-hand phone market.'
The budget mobile phones will benefit from the growth of the second-hand phone market. Park Jin-hwan, a deputy researcher at the Korea Institute of Science and Technology Evaluation and Planning, stated, 'Since second-hand phone users often sign up for budget mobile phones with lower plans than telecommunications companies, the activation of second-hand phone transactions through the government certification system will lead to advantages for budget mobile phones.'
Due to the characteristics of budget mobile phones, which do not sell devices, it is necessary to purchase self-supplied phones (new devices purchased through manufacturers without going through a telecommunications company) or second-hand phones to enroll in budget mobile phones. According to the Korea Institute of Science and Technology Evaluation and Planning, as of 2023, 6.9% of subscribers among the three major telecommunications companies are using second-hand phones, while 26.6% of budget mobile phone subscribers are second-hand phone users.
Ko Myung-soo, chairman of the Korea Budget Telecommunications Association, remarked, 'The second-hand phone transaction certification system has been a long-cherished wish of the budget mobile phone industry. As a result, the budget mobile phone market will receive a reflective benefit,' adding, 'Budget mobile phone companies will drive to activate second-hand phone transactions through marketing.'