October 16, 2018

Apple enforces telecom carriers to make new sales system for iPhone only

PUBLISHED : December 04, 2017 - 16:46

UPDATED : December 04, 2017 - 16:46

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[ET NEWS] Apple has reportedly been asking the nation’s top three telecom carriers -- SK Telecom, KT and LG Uplus -- to make a new sales system for iPhone only at their own expense, according to industry sources on Dec. 4.

Currently, the three firms are using PC-based Windows OS to sell their service plans for new phones, including iPhone. But Apple is asking to set up a separate iOS-based system and use its own iPad tablet when they sell iPhones. 

Sources say Apple wants the new system to be set up before its first flagship store opens in Seoul early next year.

“Apple is making unfair demands,” a retail shop owner told ET News on condition of anonymity. “The system handles sensitive personal information. In order to stabilize the system, it would take months not to mention the extra costs.”

Sources say building a new system could cost some millions of dollars for each telecom carrier.

Telecom carriers look bewildered by the unprecedented demands from their key client.

“Telecom carriers may not be able to resist Apple’s demands considering loyal customers of iPhone and the already heated competition among them,” said an executive from a telecom firm who declined to be named. “We have no other option but to accept the demands.”

A spokesperson of Apple Korea didn’t respond to queries.

Apple has been criticized for its unfair business practices with Korean partners. It is forcing telecom carriers to shoulder all the marketing costs for new phone launches, while asking retail shop owners to follow their display rules even though they sell other brand phones.

According to news reports, Korea’s Fair Trade Commission raided Apple Korea’s Seoul office late last month to probe into the company’s business practices, including unfair retail contracts and high pricing policies.

By Kim Yong-joo and Choi Jae-pil
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