Korea FTC Allows Apple to Draw Up Measures to Correct Anti-Competitive Practices

South Korea's antitrust regulator has decided to allow Apple to map out a set of measure to address its anti-competitive business practices in the country, reports the Korea Herald.


The Fair Trade Commission investigated Apple Korea for requiring SK Telecom, KT Corp, and LG Uplus Corp to pay the cost of television advertisements and warranty service for its iPhones.

The investigation found that Apple holds a clear advantage over local mobile carriers and that handing over the cost of advertisements was another means of squeezing the profits of the carriers, according to the report.

The law requires that Apple comes up with a correction scheme necessary to restore competition practices or to improve business practices. The commission said it will review detailed corrective measures crafted by Apple Korea and decide whether to approve them.

Apple Korea welcomed the commission's decision and issued the following statement.

"We don't believe we have done anything wrong but are happy to put this process behind us so we can focus on doing even more for our customers and communities," Apple Korea said in a statement.

Apple has faced criticism over its business practices in the country before. In April, the FTC ordered the company to change unfair provisions in its contracts with certified repair service partners which stipulated that the firms could not file lawsuits against Apple within a year after any dispute.

The repair service partners were seen to have little choice but to agree with the terms, due to the market power of Apple's iPhones. Apple complied with the FTC order and changed the contracts.

In 2015, the FTC also ordered Apple to allow customers refunds for repair services.

Top Rated Comments

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Avatar
8 weeks ago
If it’s for Apple’s iPhone ads that show the carrier’s name at the end for a split second then it’s not fair that carriers bear the full cost or even half of it. If you blink you’ll miss the carrier’s name.
Score: 2 Votes (Like | Disagree)
Avatar
8 weeks ago


Carriers can't sell the iPhone unless they also run/pay for iPhone ads.

That’s true for any business. If you want people to know you sell something you need to advertise it. People want the iPhone, and more than one carrier has it. So Apple doesn’t need to advertise it they can let the carriers fight over doing so.


Hard to say from the press releases. Although one sounds like Apple Korea is requiring the Korean telecoms to pay for Apple's marketing in that country. Not the telecoms marketing of the iPhones but Apple's marketing. I expect more will be know if they go to court and don't settle.

"As Apple does not allow mobile carriers to offer subsidies for iPhones, they may have been forced to pay for Apple Korea's marketing activities," said another source.
http://www.koreatimes.co.kr/www/news/tech/2016/06/133_207542.html

So they were locked from doing business as normal and they found an alternative to raising prices. Meanwhile, the carrier that works the hardest pushing the device sells more lines. It sounds like Korea is upset because Apple followed the letter of the law.


Should carriers also be expected to shoulder the cost of repairs?

If they want to offer that service, yes.
Score: 1 Votes (Like | Disagree)

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