What's Holding Up the Release of the New iPhone in Korea

Apple's decision to postpone the release of the iPhone 4 in Korea has set the rumor mill spinning. Apple CEO Steve Jobs said in a press conference at company headquarters in Cupertino, California on Friday that the delay is due to problems with "government approval." The ensuing speculation sent the iPhone's distributor KT and the Korea Communications Commission, which is in charge of approving the device for domestic sale, on the defensive, saying Apple failed to apply for the certification tests. So who is telling the truth?

Korean industry insiders say that disagreements between KT and Apple are behind the delay. Apple has apparently demanded promises from regional sales representatives to sell a set number of iPhones if they want the right to exclusive supply. Contracts with Apple also contain unfavorable conditions for regional sales representatives, including that they have to pay for after-service and marketing. "Korea was the 85th country in the world to introduce the iPhone but ranks at the top when it comes to the rise in sales volume, which surpassed 800,000 units in just seven months," said one insider. "KT apparently made more demands citing those conditions."
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