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Apple succumbs to antitrust pressure

Fair Trade Commission Chairman Han Ki-jeong (FTC)
Fair Trade Commission Chairman Han Ki-jeong (FTC)

US smartphone giant Apple said Tuesday it will voluntarily correct its unfair policy of charging greater commission fees to Korean app developers than in other markets by January next year.

The decision comes after South Korea’s antitrust watchdog began a probe into the iPhone maker over its Korea-exclusive charging system that is based on consumer prices, including value-added tax.

This means Korean developers are forced to pay a 33 percent commission to Apple, above the 30 percent rate imposed in other markets.

Despite Apple’s announcement to voluntarily correct its commission policy, the Fair Trade Commission made clear it will continue to look into unfair business activities by Apple.

“If Apple fixes the problematic action well, it will ease difficulties faced by domestic app developers to some extent. Active communication between app market operators and app developers will also help establish a fair and dynamic app market ecosystem,” said Fair Trade Commission Chairman Han Ki-jeong during talks with app industry insiders held in Pangyo, Gyeonggi Province, Tuesday.

“We will continue to monitor practices in the app market and establish an ecosystem that benefits both operators and developers.”

In an official statement, Apple said that starting from January next year it will calculate the commission for Korean developers excluding value-added tax from app-generated sales, and that additional details will be explained to app developers step by step.

“We will support Korean app developers to grow in all app stores around the world and feel pride in their work by providing them with the best tools and technology,” the statement read.

Likewise, the FTC is expected to soon decide how it will penalize Google for abusing its market power with the Android mobile operating system by forcing app developers to exclusively launch their apps on its app market.

The FTC has been running a probe into Google amid criticism that the company obstructed game developers such as Nexon, NCSoft and Netmarble from launching their games in other app markets.

“In order to continue to support the dynamics and innovation of the app market ecosystem, the abuse of monopoly power by app market operators needs to be corrected in a timely manner. We are making various efforts to create basis for a fair competition in the app market,” said Han.

He added that soon the FTC will also establish a team especially in charge of online platforms to strategically deal with problems deriving from monopoly in such platforms.



By Hong Yoo (yoohong@heraldcorp.com)
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