Precedent 'SKT Penalty Exemption'

As SK Telecom (CEO Yoo Young-sang), which has been hacked into 27 million USIM information, has been exempted from cancellation penalties, the impact is spreading across the telecommunications market. Competitors such as KT (CEO Kim Young-seop) and LG Uplus (CEO Hong Bum-sik) seem to enjoy the reflective benefits of increasing subscribers, but they cannot just laugh because they can be asked for the same level of compensation in the event of a hacking accident in the future.

As of midnight on April 18, before the hacking incident, SK Telecom has decided to waive penalties for customers who cancel the breach and those who are scheduled to cancel the breach by July 14. SK Telecom's decision was made possible because the Ministry of Science and ICT threatened to review the suspension of business for three months in response to a correction order unless the company exempts the penalty.

However, the Ministry of Science and ICT said, "The decision is limited to SK Telecom's case." This means that even if all hacking accidents occur, the company does not unconditionally exempt the company from the penalty.

In fact, the telecommunications industry perceives it differently. As SK Telecom's decision to exempt penalties has become a precedent, public opinion that in the event of a hacking accident, the government wants a penalty exemption card could grow.

An industry official said, "We believe that SK Telecom's decision to waive the penalty could attract more subscribers, but it is not very good for other carriers," adding, "In the event of a hacking accident, it will remain as an example of a carrier's response, which can increase the burden."

Another industry official also said, "The issue of penalty exemption could be solidified as a compensation measure that carriers can come up with in the event of a hacking accident."

Earlier, KT had 12 million customers whose personal information was leaked in 2014, while LG U+ failed to prevent 300,000 customers from leaking their personal information in 2023. At that time, some voices were raised for exemption from penalty, but this was not implemented. However, chances are high that SK Telecom will continue to call for exemption from penalty in the future.

Penalty exemptions could soon lead to a decline in mobile carrier profits. SK Telecom has already lowered its forecast for this year's sales from 17.8 trillion won (17.8 trillion won) to 17 trillion won (12.7 billion dollars). Its consolidated operating profit is also expected to decline year-on-year. SK Telecom's operating profit stood at 1.8234 trillion won (1.1 billion U.S. dollars) last year.

It was even mentioned that the operating profit of the steering committee decreased. "The exemption of the penalty could result in the loss of up to 5 million subscribers on a monthly basis," SK Telecom CEO Yoo Young-sang said at a National Assembly hearing on May 8. "Considering the immediate penalty and three-year sales, the company is expected to lose about 7 trillion won in operating loss."

fun3503@chosunbiz.com