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SK Telecom could lose up to $5 billion if it waives termination fees, CEO says

Published: 08 May. 2025, 17:59 Updated: 09 May. 2025, 16:47

SK Telecom CEO Ryu Young-sang answers questions on the recent SKT hack at the National Assembly building in Yeouido, western Seoul, on May 8. [YONHAP]

SK Telecom could lose up to 7 trillion won ($5 billion) if early termination fees are waived for subscribers looking to switch carriers, CEO Ryu Young-sang told lawmakers Thursday. The projection includes three years’ worth of lost revenue from as many as five million customers who may leave the service within a single month.

Ryu testified before the National Assembly’s Science, ICT, Future Planning, Broadcasting and Communications Committee during a hearing on the recent hacking incident at the telecom giant.

He said waiving termination fees could prompt more than 2.5 million subscribers to exit — 10 times the 250,000 customers who have already left following the cyberattack.

“Each user is likely to incur at least 100,000 won in fees on average,” he said, estimating that the total value of waived fees alone could reach 250 billion won.

“This is not just a legal matter — multiple factors are involved, including the mobile telecom ecosystem and a range of losses for SK Telecom,” said Ryu maintaining that the issue of waivers requires further review.

Ryu pledged to launch a committee to rebuild trust with consumers.

“Until now, SK Telecom has focused on customer protection through services like USIM replacement and fraud detection systems,” Ryu said. “We’ll listen to customers’ voices through the trust restoration committee and take measures to ensure their protection,” he added.

“We’ll make sure the committee addresses the entire plan for restoring customer trust, including the termination fee matter.”

The Ministry of Science and ICT said it had commissioned law firms to conduct a legal review on matters such as exempting SKT’s termination fees, and that it received their responses the previous day and is compiling a comprehensive summary.

“When determining whether the business operator is at fault, we must consider not only intent and negligence, but also the current level of information security technology and protective measures,” said Science Minister Yoo Sang-im. “A joint public-private investigative team is thoroughly examining the full extent of the damage, and we expect the team’s findings within one to two months,” according to the ministry.

BY KIM MIN-YOUNG [[email protected]]