In a shocking statement released by South Korea's Fair Trade Commission, it was revealed that Apple is financial exploiting various South Korean wireless service providers. On the same statement, the antitrust watchdog accuses the American tech giant of taking advantage of South Korean wireless carriers by collecting money for ads.
In a statement acquired by Apple Insider, Federal Telecommunications Commission investigators claim that "[Apple] collecting advertising funds are merely additional ways of exploiting telecom carriers' communications service profits."
The federal investigators added that the involvement of Apple in the advertising activities of South Korean wireless carriers is not considered as part of the tech giant's branding strategies. Because of these findings, the commission is accusing Apple of violating a number of antitrust rules.
Apple is being accused of unfairly offloading a significant part of iPhone cost on Korean carriers. These costs include repairs as well as the launching of various events. Apple was invited to present its defense and, like the Federal Telecommunications Commission, the company was also allowed to bring experts like business academics and economists to stand as witnesses.
One Apple witness was quoted defending Apple saying, "When advertising funds are formed, it benefits both Apple and mobile carriers."
The witness added that Apple's involvement in advertising activities is just part of the company's effort to maintain its brand reputation. A third hearing is scheduled to be heard on Feb. 20 and may subsequently result in a final ruling. Should the commission find Apple guilty of these wrongdoings, the company is facing a fine of up to 2 percent of total connected sales.
This allegation of violations of antitrust laws dates back to 2016. Investigations on the matter have resulted in a number of raids on Apple offices, including one in June 2016 and in November 2017.
It is no longer a secret that Apple is sometimes harsh when it comes to negotiating terms with various wireless carriers. Some analysts have noted that this is just part of Apple's aggressive marketing strategy to sell its products, more specifically the iPhone.
This is also not the first time that Apple has faced similar accusations. In 2013, the tech giant was fined by the Taiwanese government to the sum of $670,000 over the same accusations. In France, Apple was forced to pay the government $55 million. In 2017, Apple, along with a number of Russian retailers, were found guilty of price fixing.
