SKT sought favors among retailers

SK Telecom has been fined 100 million won ($94,460) by the Fair Trade Commission for using various methods to interrupt the phone sales of LG U+, the No. 3 player in the domestic market.

The fair trade watchdog confirmed yesterday that SKT forced workers at stores selling mobile devices for all three local network carriers to prioritize its devices rather than those affiliated with other networks in an attempt to boost its subscribers.

At stores where the number of new LG U+ subscribers has rapidly shot up, SKT threatened that it would stop providing mobile devices synced with its network unless its products got preferential treatment, the FTC said.

Such moves to control the sales of smaller retailers came as LG U+ has been promoting a variety of marketing strategies for its long-term evolution (LTE) service to boost sales since the service was launched in September 2011.

LG U+ claimed to be acting aggressively to make up for the losses it sustained as a latecomer to the smartphone business, and SKT is seen as resorting to unfair practices to keep pace.

“SKT tried to weaken the competitiveness of LG U+ so its sales could go up,” said the FTC in a release.

SKT also abused certain privacy laws to determine which stores were selling the most LG U+ devices, the watchdog said.

It told retailers it was checking their systems to see whether they distributed its subscribers’ personal information, when in fact it was looking to see which stores signed up the most new LG U+ subscribers, the FTC added.

SKT picked around 100 popular mobile retail outlets in December 2011 and stopped distributing store codes and mobile phones to 66 of them for a month, as a form of punishment, according to the watchdog.

The FTC acquired documents written by SKT insiders about its plan to push phone retailers to sell fewer phones tied to LG U+ and more linked to its network, it claims.

By Lee Sun-min [summerlee@joongang.co.kr]