[Edaily Reporter Kim Hyun-ah ] Going forward, consumers will be able to freely choose their contract term when signing up for IPTV online.

This is because KTCorporation had limited online sign-ups to a 3-year contract only, while SK Broadband and LG Uplus had restricted online sign-ups for standalone IPTV plans—but the Korea Communications Commission has now taken enforcement action.

The Korea Communications Commission (Chairman Kim Jong-cheol) held a plenary session yesterday (the 23rd) and voted to issue corrective orders and impose fines against KTCorporation, SK Broadband, and LG Uplus for violating the IPTV Act.

KTCorporation(030200)Although the terms of service allowed customers to choose from various contract periods for standalone IPTV plans, online sign-ups were restricted to a 3-year contract only. It was also difficult to find pricing information for different contract periods online.

Following the Commission’s investigation, KTCorporation removed the phrase “only 3-year contracts available” and updated its online sign-up screen to allow customers to choose between 3-year, 2-year, 1-year, and no-contract options.

SK Broadband and LG Uplus(032640)restricted online sign-ups for standalone IPTV plans altogether.

SK Broadband provided only pricing information for bundled plans combining internet and IPTV on its website and did not display pricing details or a sign-up button for standalone IPTV plans. LG Uplus also focused its pricing information on bundled plans and informed users that standalone IPTV plans could not be subscribed to online.

During the KCC’s investigation, both companies disclosed pricing information for standalone IPTV plans and updated their online screens to enable online sign-ups.

The KCC determined that the actions of the three companies constituted prohibited conduct under the IPTV Act that restricted users’ reasonable choice. However, it classified all cases as “minor violations” and calculated the fines based on factors such as relevant revenue and the duration of the violation.

The fines are 31,078,155 won for SK Broadband, 14,122,124 won for KTCorporation, and 3,803,653 won for LG Uplus.

This investigation began as part of a review of IPTV rates and subscription practices in 2023. At that time, the Commission examined the online subscription environment, taking into account factors such as the high proportion of IPTV services sold in bundle with telecommunications products. The KTCorporation underwent an on-site inspection from May 1 to 18, 2023; SK Broadband from May 1 to June 14; and LG Uplus from May 1 to 2. The KCC launched a fact-finding investigation in November of the same year.

Commissioners pointed out that, in addition to these sanctions, it is necessary to examine whether there are cases where users’ freedom of choice is restricted during the offline subscription process as well.

Commissioner Ryu Shin-hwan stated, “From the consumer’s perspective, providers’ practices that restrict choice are highly noticeable in everyday life and constitute unfair acts that limit consumers’ range of options,” adding, “If the same behavior is repeated or similar acts recur, strong disciplinary action is necessary.”

Commissioner Yoon Seong-ok emphasized, “While it is important to punish past violations, we must also examine whether the rights and interests of the public are currently being infringed upon,” noting that since online subscribers account for only about 3% of the total, it is necessary to examine the offline market as well.

The Fair Trade Commission plans to serve the resolution on the businesses and then verify whether they have complied with the corrective order.