Cable firms call for tougher sanctions on product bundling

Kim Jeong-soo, secretary general of the Korea Cable TV Association (KCTA), explains its plan to tackle the growing market uncertainty for the declining cable TV industry, at the Korea Press Center in central Seoul, Wednesday. / Courtesy of KCTA

By Lee Min-hyung

The nation’s cable TV association has called for the government to toughen sanctions on mobile carriers’ product bundling, as it hurts fair competition and dampens the already gloomy outlook for the cable TV industry.

The Korea Cable TV Association (KCTA) voiced its concern at a press conference Wednesday when it announced its “One Cable” initiative with which the organization is seeking to revitalize the declining cable TV outlook here.

“Mobile carriers ― such as SK Telecom ― are increasing their market share by bundling such services as mobile and internet protocol television (IPTV), posing a threat to cable TV operators which cannot sell such bundled services,” Kim Jeong-soo, secretary general of the KCTA, said, urging the government to revise the current legal system in a way to foster fair competition in the media industry.

Without a more specific and fair legal system, the nation’s media industry will fall prey to the dominating power of such mobile companies, said the KCTA executive.

The nation’s cable industry has suffered a serious setback in recent years, as it failed to compete with IPTV services. Amid the growing market uncertainty and falling revenues, the cable TV coalition established an emergency planning committee in late July, right after the government disapproved of a controversial takeover of the nation’s top cable TV operator CJ HelloVision by SK Telecom.

During the press conference, the committee unveiled the One Cable blueprint. Under the initiative, the KCTA said it will push for developing a unified platform for some 90 cable TV operators across the nation.

Toward that end, the organization pledged to join forces with local cable operators to develop next-generation quality services and technologies, in its bid to compete fiercely against IPTV operators.

“We are also planning to launch an internet-based platform such as smart home services,” he said. “The KCTA will focus on establishing our own smart home ecosystem which is largely different from that of mobile carriers.”

It added that the cable TV industry can be reshaped under the framework of the initiative, dispelling concerns both at home and abroad over the outlook for the cable TV industry.

Under the roadmap, the KCTA said it will start collaborating with Internet of Things (IoT) service operators this year, and set up a standardized broadcasting technology by next year.

The KCTA also said it will end existing analog television broadcasting by 2018, replacing it with digital broadcasting.

Meanwhile, the nation’s cable TV industry has stood at a crossroads over its lack of new growth engines.

The rise of internet and IPTV has been cited as the key reason for its decline in recent years, with mobile carriers ― backed by their massive capital strength ― launching a series of bundled products combining their telecom services with internet and IPTV. Failing to catch up with the internet-centered media transition, cable TV operators have slowly lost their ground to the capital-backed telecom operators.