Korea to Expand PC Support for Low-Income Families Amid 'Chipflation' Price Surge

AI Boom Drives DRAM Shortage, Pushing Computer Prices Up Double Digits · Government to Redistribute Surplus PCs to Vulnerable Groups · Telecom Carriers to Offer Unlimited Voice and Text for Seniors 65+

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By Seo Min-woo
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null - Seoul Economic Daily Finance News from South Korea

The Korean government will provide laptops and PCs that have exceeded their useful life to low-income households and students to bridge the widening digital divide caused by "chipflation." The government also plans to introduce data safety options (QoS) across all LTE and 5G data plans offered by the three major telecom carriers and provide unlimited voice and text services as standard for subscribers aged 65 and older.

Deputy Prime Minister and Minister of Economy and Finance Koo Yoon-cheol announced these consumer price management measures while presiding over the Special Consumer Price Management Ministerial Task Force at the Seoul Government Complex on Friday.

The government will expand PC and laptop support programs for vulnerable groups. Rising DRAM prices have pushed up PC and laptop prices, increasing the purchasing burden on low-income households and students.

Laptop prices have risen sharply in recent months. Company A's Model C increased 18.1% from 2.16 million won last September to 2.55 million won currently, while Company B's Model D rose 5.8%. The consumer price index for computers climbed 12.4% year-on-year in March, marking the second consecutive month of double-digit growth.

The government will first actively recycle surplus PCs from national agencies to significantly expand support for vulnerable groups. The central government will increase the proportion of surplus PCs that have exceeded their useful life for redistribution to local government support programs. Under current Public Procurement Service guidelines, desktop PCs are classified as surplus after five years, laptops after six years, and tablets after five years. The government plans to revise the procurement agency's surplus disposal guidelines to increase the share of free transfers.

Direct purchase support for vulnerable groups and students will also be strengthened. Once the supplementary budget is finalized, the government will use the increased local education finance grants (4.8 trillion won, approximately $3.5 billion) to expand purchase support programs for students from low-income households. Per-person support amounts will be raised from the current 1.042 million won. The government will also proceed with distributing one device (laptop or tablet) per elementary and middle school student in line with policies promoting artificial intelligence and digital education.

Additionally, the government will conduct inspections of distribution and supply conditions in the DRAM, PC, and laptop markets, investigating potential legal violations and taking strict action if irregularities are found.

To guarantee basic telecommunications rights, the government will reform rate plans offered by the three major carriers—SK Telecom, KT, and LG Uplus. Data safety options (QoS) will be introduced across all data plans, allowing users to continue using data at basic speeds even after exhausting their monthly data allowance. An estimated 7.17 million users (based on January subscriber numbers) are expected to save approximately 322.1 billion won annually in telecommunications costs.

Unlimited voice and text services will be provided as standard for users aged 65 and older, with additional voice and text benefits extended to seniors on existing plans. Approximately 1.4 million users are expected to save around 59 billion won annually.

The government is also pursuing integration of LTE and 5G plans, with automatic benefit application when users reach certain ages instead of operating separate age-based plans. Once implemented, the basic 5G plan price, currently in the upper 30,000 won range, is expected to drop to the 20,000 won range.

The government aims to complete the telecom carriers' rate plan reforms within the first half of this year.

Economic sanctions against illegal tuition fee increases at private academies will also be strengthened. The government will introduce penalties of up to half of revenue to recover illicit profits from illegal academy practices such as collecting excess tuition fees. Fines for violations of the Private Academy Act, including false advertising of tuition fees, will increase from 3 million won to 10 million won.

Enforcement has also intensified. Since January, the government has conducted special inspections targeting irregular tuition increases at 15,925 academies nationwide, identifying 2,394 violations and issuing 3,212 administrative penalties. Inspections increased by 3,828 cases compared to January-March of the previous year, with violations up by 297 cases. Inspection targets were selected primarily from academies with registered tuition fees in the top 10% per education office and those with high tuition increase rates over the past five years.

Meanwhile, the government has designated 43 items including energy, manufactured goods, public utility fees, and food products for special management in response to inflation concerns stemming from the Middle East conflict, operating a daily monitoring system.

"We are monitoring specially managed items on a daily basis while implementing measures to address industry difficulties, reduce burdens, and establish market order," Vice Minister of Economy and Finance Kang Ki-ryong said. "Along with freezing central public utility fees including electricity in the first half, we will work with local governments to maintain stable management of local public fees for taxis, city buses, and subways under the principle of a first-half freeze."

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AI-translated from Korean. Quotes from foreign sources are based on Korean-language reports and may not reflect exact original wording.