KCC IMPOSES FINE ON GOOGLE

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The Korea Communications Commission imposed a fine of over 800 million won on Google, the provider of the YouTube Premium service. The communications oversight body concluded that the service's membership cancellation and fee policies violated the interest of its subscribers.

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YouTube Premium offers ad-free streaming at a price. This video service attracted subscribers with incentives like a month of free trial viewing. The Korea Communications Commission decided to impose a fine of over 860 million won on Google.

[Soundbite] CHOI SEONG-HO(KOREA COMMUNICATIONS COMMISSION) : "The service provider did not notify users of the subscription cancellation and refund policies. Not explaining or informing such important matters is in violation of Korea's communications laws."

The watch dog initially concluded that Google has committed 3 illegal acts. The first violation has to do with limiting service cancellation. When a subscriber asked for mid-use cancellation, the tech giant did not process the request immediately, but deferred it until the next payment day. The service provider didn't even refund the unused portion of the membership. Second: Google also did not notify users of an important matter. The actual amount a user has to pay is 8,690 won per month, which includes the value-added tax. But the monthly fee was advertised as 7,900 won without marking the VAT or showing it as 0. The last issue: After a month-long free trial period was over, the membership was converted into a paid one without user consent. However, on this particular matter, the KCC decided to issue only a correction recommendation since it is not exactly in violation of the law.

[Soundbite] CHOI SEONG-HO(KOREA COMMUNICATIONS COMMISSION) : "Global operators must follow the same domestic laws as Korean operators."

At a testimony given at the Commission, Google claimed that it was just following an accepted industry practice. Last week, the Korea Fair Trade Commission ordered Netflix to correct its unfair pricing policy. The government appears to be toughening its oversight of the global over-the-top service providers in the wake of a controversy surrounding discrimination of local subscribers.