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South Korea said on Monday it fined three telecoms firms, including top mobile carrier SK Telecom Co, a combined 26.9 billion won ($26.85 million) for unfairly subsidising mobile phone costs for new subscribers. The information ministry is concerned that a fight for customers is undermining fair competition in Asia's third-largest mobile market, where three out of every four people already have a mobile phone. "The telecoms committee has decided to impose a total of 26.9 billion won in fines on three operators as they disrupted fair competition in the market by offering hefty subsidies," the ministry said in a statement.

The government imposed the biggest fine of 23.1 billion won on SK Telecom, followed by LG Telecom Co Ltd, the country's third-largest mobile operator, with 2.7 billion won.

It also fined KT Corp, the country's top fixed-line and broadband operator, 1.1 billion won. KT sells mobile phones for its wireless unit, KTF Co Ltd Aggressive marketing efforts have intensified since the introduction last year of number portability, which allows subscribers to keep their phone number when changing service provider.

"We plan to step up monitoring of the market and will take stern action if any irregularities are found," the statement said.

In late February, KT and KTF faced combined 8.5 billion won in fines for offering subsidies, and various operators are frequently fined for other irregularities, such as excessive charges or blocking service termination requests.

As a result, the ministry said it plans to hold meetings twice a month instead of monthly to more frequently monitor market conditions.

Copyright Reuters, 2005


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