Laughing Up Their Sleeves
KT and LG U+ are feeling at ease about the Fair Trade Commission’s recent decision not to approve a business combination and stock sale between SK Telecom and CJ HelloVision although the final decision has yet to come through the commission’s general meeting. At present, both LG U+ and KT are taking a close look at how SK Telecom and CJ HelloVision will respond.
The decision of the Fair Trade Commission took no less than seven months. During the period, strife between the South Korean mobile carriers continued to intensify, making it more likely that mudslinging on each other will become more severe than ever in the domestic telecom and paid broadcasting markets.
With SK Telecom’s plan to absorb CJ HelloVision’s cable TV subscribers via the IPTV service of its subsidiary SK Broadband thwarted, SK Telecom is likely to become more aggressive in both markets. In addition, SK Telecom might raise an objection or resort to an assessment by the Ministry of Science, ICT & Future Planning or administrative litigation.
Besides, the South Korean government’s calling plan-related regulation that has been applied to only SK Telecom can be called into question. This regulation is for the government to inspect the appropriateness of a new calling plan before a market dominator releases it. So far, SK Telecom has claimed that the regulation hinders free market competition while KT and LG U+ have argued that it is a matter of fair competition.