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SK Telecom pledges compensation over service failure

Posted March. 22, 2014 03:22,   


More than 5.6 million users are reported to have been suffered damage from SK Telecom’s mobile phone service failure, which lasted for nearly six hours from 6 p.m. on Thursday. Korea`s top mobile service provider pledged to compensate all of its subscribers, as well as those who suffered damage.

Top management including SK Telecom CEO Ha Seong-min held a hurriedly arranged press conference at the company’s headquarters in central Seoul on Friday, made a public apology for its service failure, and announced a compensation plan and measures to prevent recurrence. “We will provide compensation by giving deduction of one-day service fee to our entire 27 million subscribers, rather than limiting compensations based on our terms of service,” Ha said. “Customers who suffered practical damage will be received additional compensation even without specific claiming.”

According to SK Telecom’s terms of service, if and when telephony service failure lasts for three hours or longer, consumers are entitled to compensation amounting to six times the duration of service failure. However, SK Telecom vowed to provide 10-fold compensation for damage this time. For instance, if a subscriber who pays 50,000 won (46 U.S. dollars) in basic monthly subscription fee suffered service failure for about three hours (200 won or 8.5 cents), he or she will receive a reduction amounting to 2,000 won (1.85 dollars) as compensation for damage, which results from 200 won multiplied by 10 folds, plus subscription fee reduction for one-day service of about 1,667 won or 1.54 dollars.

In addition, SK Telecom will deduct one-day service fee (about 1,000 won or 93 cents) from the basic subscription fee of its entire subscribers, in addition to those who suffered direct damage from Thursday’s service failure. SK Telecom estimate for total compensation payouts will be at least 40 billion won (37 million dollars). In the event that businesses including door-to-door delivery services or call taxis have suffered damage due to telecom service disruptions, the telecom company will take steps to pay compensations through a separate process to verify damage incurred.

It has been confirmed that the recent service failure is related to the subscriber identification module.