As reported today in The Korea Joongang Daily, some observers are claiming that there is collusion among the three main mobile service providers in the setting of service fees. As shown in the accompanying graphic (click for a full-size version), all three service providers have nearly identical service charges. Consequently the civic group People’s Solidarity for Participatory Democracy (PSPD), has raised suspicion of collusion. The civic group reported its suspicions to the Fair Trade Commission on May 18.
The Korea Joongang Daily article also quoted Lee Joon-gil, former FTC official and senior adviser at the law firm Jipyong as saying “It’s not a collusion when everyone unfolds their umbrella when it rains but when everyone is holding up a black umbrella, one could suspect collusion. When all of the three mobile carrier’s service plans are similar, it is unnatural as holding up a black umbrella.”
According to the article, the mobile companies say that in meeting consumers’ demand for cheaper smartphones, price competition is focused mostly on the device subsidy rather than on the service charges. “The phone, text messaging and data services are all similar among the three mobile carriers, and that’s why the services charges are similar,” said an industry official. “[People] don’t see soju, whose prices are similar [among different brands] as a collusion.”
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