Apple accused of passing on iPhone costs to Korean carriers

Apple accused of passing on iPhone costs to Korean carriers
The South Korean FTC, which like its U.S. counterpart is focused on antitrust issues, is accusing Apple of exploiting wireless providers in South Korea by collecting payments for advertising. The Korea Herald reports today (via Apple Insider) that the agency's theory is that in the process of collecting ad revenue, Apple Korea is passing certain iPhone related costs on to South Korean carriers.

Both Apple and the Korean FTC appeared at a hearing last week. One FTC investigator testified that "Apple’s involvement in advertising activities cannot be justified as its branding strategies." Both sides had economists take the stand, with one Apple witness stating that "When advertising funds are formed, it benefits both Apple and the mobile carriers. Apple’s involvement in the advertising activities is justified as it maintains Apple’s brand."


The Korean FTC investigation into the practices used by Apple to sell the iPhone in the country have been under investigation since 2016. The following year, Apple's headquarters in South Korea were raided by officials.

Last week's hearing was the second of three such events. The third hearing will take place February 20, with both sides expected to present more detailed evidence and testimony. A ruling could be issued shortly thereafter. If Apple loses, it could be fined as much as 2% of relevant sales.

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16 Comments

2. TBomb

Posts: 1582; Member since: Dec 28, 2012

so question for everyone... is apple getting a lot more heat than usual? or are we just noticing it more now? Is this a common occurance? I mean.. to someone who only sees headlines they'd think Apple is the next Enron

3. lyndon420

Posts: 6840; Member since: Jul 11, 2012

It's called karma, and it's finally catching up to apple.

5. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Basically they were doing this stuff before, but court cases take years to form and now they're all hitting the spotlight. The other issue is, thanks to falling iPhone sales and revenues, Apple is getting more desperate. They have no future strategy, no products or ideas to steal and copy. Now they are stuck with a finance guy at the head with not a single innovative thought in his head, other than how to move around numbers. They're doing more and more stupid things and its all slowly corrupting their future.

13. htcisthebest

Posts: 437; Member since: Nov 15, 2011

Well, they certainly deserve all these - Apple was the one who corrupted the world and the consumers at first.

16. midan

Posts: 3023; Member since: Oct 09, 2017

"The other issue is, thanks to falling iPhone sales and revenues, Apple is getting more desperate. They have no future strategy, no products or ideas to steal and copy." Wow you guys are funny, sure Apple have no idea what they are doing.. :D For me it looks like they are heavily investing to services and it's right move. When hardware sales are going down you need to keep your current users and get more money from them while they are using your device. For me it looks like Apple strategy is very strong and their foundation for that couldn't be better. If you keep your current users happy they more likely buy your product in future too and so far this have happened every year, just a slower pace, because users keep their devices longer, but as long as they choose iPhone or other iOS devices they will eventually give Apple the money.

17. mootu

Posts: 1530; Member since: Mar 16, 2017

"When hardware sales are going down you need to keep your current users and get more money from them while they are using your device." So you are advocating Apple to milk more money from it's users? What you don't seem to understand as you are such a fanboy is that this is what people are fed up with. Users are tired of the rising prices and penny pinching strategy that Apple has been running for the last few years. I know of 5 people in my family and friends that have ditched Apple in the last 12 months, all said it was down to Apples money grabbing antics and these are people that can afford Apple devices but are saying enough is enough.

22. midan

Posts: 3023; Member since: Oct 09, 2017

Because you are such a hater you of course want to understand everything wrong. "So you are advocating Apple to milk more money from it's users?" Isn't that the companies point? rumours are saying they will soon launch video subscription service. They have Apple music, they have rumoured to release somekind of news and magazine subscription service. How this is milking users if they offer new services for us to enjoy? no-one force you to buy them if you don't see value with these, for example i have zero interest about upcoming news or magazine service, but i'm interested what their video service going to be And of course point of these new services is to hook users to stay in iOS ecosystem. "Users are tired of the rising prices and penny pinching strategy that Apple has been running for the last few years." just like i said you understood it wrong because you are such a hater.

4. L0n3n1nja

Posts: 1579; Member since: Jul 12, 2016

Years of abusing everyone globally is finally biting them in the ass.

8. Cat97

Posts: 1939; Member since: Mar 02, 2017

Apple is hard pressed by the low sales issue, and they try everything to stay afloat. Of course, none of these erratic moves will work in the end. They will finally need to face reducing prices and profits.

6. htcisthebest

Posts: 437; Member since: Nov 15, 2011

2% is too low of a penalty. Charge them 10%!

7. TechNeck

Posts: 656; Member since: Aug 29, 2014

All of this news from Apple is very disappointing. Their business practices as of recently have been very avaricious and has became a deterrent for many. They need to do a complete 180 before it gets worse for them.

9. darkkjedii

Posts: 31365; Member since: Feb 05, 2011

This is gonna be an important year for Apple, but how they handle it will have repercussions for years to come.

10. cncrim

Posts: 1590; Member since: Aug 15, 2011

It is not Apple fault, it is consumers fault. China is a perfect example consumers power don't buy them price they slash not only that they willing eat small petty stuff for profit

11. SIGPRO

Posts: 2817; Member since: Oct 03, 2012

Fruit company truly sucks, they cheat, lie, mislead and steal!

12. Spacekid

Posts: 16; Member since: Jan 17, 2019

I think this all started because apple got rid of the their signature design by steve jobs.

* Some comments have been hidden, because they don't meet the discussions rules.

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