Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
SK chairman apologizes for telecom unit’s massive data breach
SK Group Chairman Chey Tae-won apologizes for the recent SK Telecom data breach during a press briefing at SK Group's headquarters in Seoul, Wednesday. Yonhap
By Nam Hyun-woo
Chey distances himself from debates on early termination fee exemptions
SK Group Chairman Chey Tae-won apologized on Wednesday for SK Telecom's recent data breach, which could potentially affect approximately 25 million customers of the mobile carrier.
"We have recently caused inconvenience and concern to the public and our customers due to SK Telecom’s data breach," Chey said. "I offer my sincere apology on behalf of SK Group."
Chey appeared before the public about two weeks after the data breach threw the country into confusion. SK Telecom, whose customers account for nearly half of the country’s population of 52 million, detected a cyberattack on April 18 and found signs of a large-scale leak of customers’ universal subscriber identity module (USIM) data. The telco announced the incident on April 22.
The exact scale of the breach and its resulting damage remain unclear. In response, SK Telecom has urged its customers to use its USIM protection service. This service blocks a USIM from connecting to the network if the identifier data sets do not match. Additionally, the company is offering free USIM card replacements to all of its customers.
SK Group Chairman Chey Tae-won gestures during a press briefing regarding SK Telecom's data breach at the group's headquarters in Seoul, Wednesday. Joint Press Corps
However, public criticism has been mounting against the telco for its delayed reporting of the breach to the telecommunications authority, its passive communication with customers, its failure to provide an adequate supply of USIM cards, and its refusal to waive early termination fees for customers switching to other carriers.
“I deeply regret the lack of appropriate communication and response following the incident,” Chey said. “We failed to address the situation from the customer’s perspective, and this is something that I and the entire management team should take seriously. I believe we deserve the criticism we have received — not only from customers, but also from the media, the National Assembly and government agencies — and we humbly accept it.”
SK Telecom users line up in front of the mobile carrier's roaming center at Incheon International Airport, Sunday, to replace their USIM cards. Yonhap
Chey pledged that SK Group will fully cooperate with the ongoing government investigations regarding the cause of the data breach and do its utmost to prevent customer damage.
In addition to these efforts, he stated that the group will conduct a comprehensive review of cybersecurity systems across all affiliates and increase investment in security measures. Furthermore, an information security committee, comprising outside experts, will be established under the SK SUPEX Council, the group’s "control tower."
“I believe this is not just a security issue but a matter equivalent to national defense,” he said. “We need to establish a robust security framework. I will approach this not just as a security concern but rather as an issue of national security or even a matter of life and death.”
Despite his apology, Chey did not make clear his stance over the ongoing debate on waiving early termination fees for customers who wish to switch to other carriers.
“To be honest, I don’t think my personal opinion on the early termination fees matters,” Chey said. “I personally believe we should prevent any inconvenience to customers, but this is a matter of fairness [between customers who have held different types of payment plans] and legal interpretation. The SK Telecom board is currently discussing the issue, and I hope a good solution will come.”
SK Telecom CEO Ryu Young-sang bows during a National Assembly hearing in Yeouido, Seoul, April 30, during a parliamentary session on the company's customer data breach. Yonhap
The National Assembly has been pressuring SK Telecom to waive early termination fees.
During a parliamentary session last week, lawmakers pressed the company's CEO Ryu Young-sang to address the possibility of a fee waiver, but Ryu declined, saying the issue requires legal review.
Irked by the response, the Assembly requested Chairman Chey to appear at a hearing scheduled for Thursday. However, Chey declined on Tuesday, citing a prior commitment to attend a meeting for the preparation of the Asia-Pacific Economic Cooperation summit.
Lawmakers have been calling for a fee waiver citing SK Telecom’s own service terms and conditions, which state that customers are exempt from paying early termination fees if the contract is canceled due to reasons attributable to the company.
Against the backdrop, the legal interpretation that Chey and Ryu noted is whether the fee waiver constitutes a breach of trust, because compensating customers without confirming whether the telco made enough efforts to protect customer data could be seen as harming the interests of shareholders.
On May 4, the National Assembly Research Service issued an opinion stating that a fee waiver aimed at restoring customer trust and serving the company’s long-term interests does not clearly constitute a breach of trust.
SK Telecom reported that all 24.11 million eligible users have enrolled in its USIM protection service, and 1.07 million users have replaced their USIM cards as of Wednesday morning. The company noted that the approximately 1 million users who are not enrolled are likely those using roaming services.