South Korea's antitrust regulator has reopened a four-year-old dispute over game performance throttling on Samsung Electronics (005930.KS) Galaxy smartphones. A class action brought by 1,690 consumers was closed through court mediation, but the Fair Trade Commission has imposed a fine of about 20 billion won ($14 million). Views diverge over whether software that regulates game performance is a feature consumers need, and whether failing to disclose the throttling in advertisements amounted to deception.
The FTC decided to issue a corrective order and a fine of about 20 billion won, saying Samsung Electronics failed to disclose that the Game Optimizing Service, or GOS, limited performance when it advertised the capabilities of the Galaxy S21, the Galaxy S22 and the Galaxy Tab S8, industry sources said on the 27th.
GOS, at the center of the dispute, regulates the operating speed of the application processor, the core chip that serves as a smartphone's brain, when a game is running. Running a high-specification game for a long stretch heats up a phone and drains its battery quickly. GOS caps the processor's operating speed to prevent that and to help games run stably.
The GOS issue surfaced in 2022, when the Galaxy S22 went on sale. Users found that processor performance was limited in some games while the same GOS did not apply to benchmarking apps that measure phone performance. Consumers complained that the peak performance highlighted in advertising could not be fully used in actual gameplay.
The dispute moved to the courts. Consumers filed a class action, saying they had been misled by advertisements that did not disclose the performance limits. In June last year, a court of first instance found that some of the advertising amounted to deceptive advertising that could mislead consumers, but dismissed the damages claim, saying a causal link to actual losses had not been established.
In February this year, a mediation decision by the Seoul High Court stated in effect that GOS was a necessary measure to suppress heat and keep game display stable. The mediation became final in March after none of the 1,690 plaintiffs and mediation participants objected. The complaint to the FTC was withdrawn, and all eight related lawsuits, including those in the United States and Israel, were also concluded.
The FTC reached a different conclusion. On the 14th of this month, about seven months after the litigation ended, the commission decided to fine Samsung Electronics about 20 billion won. It said that advertising products by emphasizing peak performance while not disclosing that performance is limited when games are running could affect consumers' purchasing decisions.
Industry officials, by contrast, question the FTC's judgment, noting that GOS is a technology meant to keep game performance stable over long sessions. Experimental data submitted by Samsung Electronics showed that frames per second in game display remained stable and device temperatures were lower when GOS was applied, they said. The fact that the FTC decided on sanctions based on some video and experimental data without conducting its own performance testing is also cited as contentious.
"Other manufacturers are also applying performance optimization technology to prevent overheating," an industry official said. "If only Samsung Electronics faces constraints on related advertising, it could create a competitive fairness problem and lead manufacturers to shy away from adopting new performance optimization technology."