SKT Faces Controversy Over Shifting Customer Appreciation Package Costs to Partners

Apology for Hacking Incident, but Over 70% of Discount Costs Fall on Partners
Franchise Owners Express Discontent... Weighing Participation

SK Telecom (SKT), a major mobile carrier, is facing controversy over a large-scale discount event being promoted as an apology for a recent hacking incident. While SKT claims the event is a gesture of apology to customers following the leakage of USIM information in April, the actual financial burden is falling on its partner companies.

According to the distribution industry on July 10, SKT has announced a "relay marketing" campaign that will offer T Membership members discounts of up to 60% until the end of next month. The event will include major franchise brands such as convenience stores, bakeries, coffee shops, and fast-food chains. SKT explained, "We have prepared this package to apologize to customers inconvenienced by the cyber breach and to thank them for their continued trust."

SKT Takes the Credit for Discounts... Franchise Owners Bear the Cost?

The core issue lies in the cost-sharing structure of the discounts. SKT is only covering 20% to 30% of the total discount amount, while the remaining portion is split between the franchise headquarters and the individual franchise owners. For example, if a 1,000 won discount is given, SKT pays 300 won, while the headquarters and the store owner must cover 700 won. Although the headquarters shares some of the burden, a significant portion still falls on each franchise owner.

Tous Les Jours, operated by CJ Foodville, is currently running a promotion throughout this month offering SKT customers a 30% discount on products purchased after 8 p.m. In this case, SKT is covering only 7% of the cost, with the headquarters responsible for 12% and the franchise owner for 11%. One Tous Les Jours franchise owner commented, "Regular events like T Day have a customer-drawing effect, so we can tolerate them, but sudden, notification-based discounts like this one feel much more burdensome," adding, "There are also large-scale discounts scheduled for next month, which is concerning."

While SKT and its partners are still discussing whether to participate in the event, franchises and convenience stores are reportedly in a difficult position. A representative from one franchise said, "This is marketing to attract SKT customers, so it's hard to understand why we should bear the cost. It's also not easy to refuse, so we feel compelled to participate against our will." Another representative stated, "In fact, even in the past, telecom companies have contributed a low percentage of the costs. We are still internally reviewing whether to participate in this event."

SK Telecom stated, "For this appreciation package, we will increase the proportion of costs borne by SKT, investing more than 10 billion won each month starting in August," adding, "We expect that by collaborating with various partners, we can provide tangible value to customers in their daily lives and stimulate economic activity, leading to real benefits such as increased sales for small business owners and the self-employed."

"Compensation Marketing Must Come with Clear Responsibility"

Since introducing the membership system in 1997?the first among domestic carriers?SKT has formed partnerships with about 30 franchise brands. In some bakery franchises, membership discount purchases account for as much as 70% of total sales. T Day, launched in April 2018, offers discounts regardless of membership tier at different partner stores on the first week of each month and every Wednesday, recently surpassing 100 million transactions.

Industry insiders point out that while membership partnership discounts are a mutually beneficial model aimed at attracting customers, it is unfair for partners to shoulder the costs of apology events resulting from a company's own mistakes. One franchise representative emphasized, "Unlike ordinary partnership marketing, this event is an apology based on SKT's responsibility, so SKT should also bear the cost of the discounts."

This controversy is not new. At the 2017 National Assembly audit conducted by the Science, ICT, Broadcasting and Communications Committee, it was alleged that the three major telecom companies, including SKT, were excessively passing on partnership discount costs to franchise headquarters and store owners. The Board of Audit and Inspection subsequently conducted an audit, citing the Fair Trade Commission's management responsibilities, but no substantial regulatory improvements were made.

Mobile carriers, due to their massive user bases, hold a dominant position in negotiations with partners, yet they still fall into a legal blind spot regarding regulations on power imbalances. A Fair Trade Commission official stated, "Franchise headquarters must obtain a certain level of consent from franchisees when conducting promotions, but since SKT is not a franchisor, it is not subject to direct investigation."