SK Telecom faces probe over subsidies

The nation’s telecom regulator said Wednesday that it would probe an alleged illegal subsidy case involving SK Telecom.

The Korea Communications Commission said SK Telecom is suspected of handing out illegal subsidies to lure subscribers from other mobile network operators.

The KCC revealed its intentions after KT, one of the nation’s major telecom firms, submitted documents it said proved the illegal marketing activities of its rival earlier this week. “SKT cannot help but express its perplexity at the investigation to be launched by the regulator since kickbacks distributed by some retail channels could exist despite the firm’s relentless efforts to curb illegal subsidy handouts,” said SK Telecom in a statement.

KT, however, has insisted that strict measures must be taken to root out such illegalities.

The second-largest mobile carrier in the domestic market has also sought to stop SK Telecom from claiming to be the first to commercialize tri-band LTE-A services. SK started running beta-testing of the service with 100 customers late last month.

KT has filed a complaint with the Korean courts and proceedings are underway.

The mobile carriers have been obsessed with “firsts,” as they can use them in marketing to potential customers.

Market watchers say the enduring conflicts between the telecom firms are rooted in fierce market competition.

SKT has been maintaining a 50 percent market share with KT and the third-largest mobile carrier LG Uplus holding 30 percent and 20 percent, respectively, for years.

By Kim Young-won (wone0102@heraldcorp.com)