updated 11:00 am EST, Wed February 15, 2012
Korean government urges Samsung, KT to deal
KT, the largest ISP in Korea, has now agreed to bring back web service for Samsung's Smart TVs, encouraged by government officials. KT refused service for the allegedly data-hungry TVs because Samsung wouldn't want to contribute to the costs associated with upgrading its network due to the added burden the TVs impose on it. Samsung filed a lawsuit against KT earlier this week, but the Korea Communications Commission negotiated a resolution between the two on Tuesday, the Wall Street Journal reported.
The agreement will have KT resume providing data to the TVs, and Samsung will in turn drop its lawsuit and agree to negotiate with KT. A KT spokesperson said Samsung created a platform without paying for using the network. Other data-delivery services already do so, he continued.
Other companies have also been approached by KT, including LG. It cites Apple as an example, for making a revenue-sharing deal with phone carriers when it launched the iPhone. However, it consciously sidestepped the reasons behind Apple's deal, where it only agreed to a revenue split as an alternative to subsidies. Apple later opted for the subsidized model and doesn't split revenue anymore.
The Korean government mandates ISPs to offer ultrahigh speed and unlimited-use Internet at a set price. Usage-based pricing therefore doesn't exist and thus limits the company's revenue and profits. Attempting to collect from device makers, however, has raised net neutrality concerns that certain companies might be "punished" for offering services the Internet provider doesn't like.