Samsung rejects KT demand to share online TV revenues

Joseph O’Halloran ©RapidTVNews | 13-02-2012

Ratcheting up its campaign to make online TV and connected TV supplier contribute to network bottlenecks, Korea Telecom is reported to be asking firms and firms, in particular Samsung,  to share in revenues they gain from such services.

Only days ago, KT said that it was reacting to online TV companies clogging its networks by limiting access to bandwidth–hungry applications such as online TV. Indeed in what was regarded as a direct criticism of connected TV manufacturers such as Samsung and to a lesser extent LG, it went as far as to slam  connected TV firms for  ‘free riding’ on its networks. LG is said to be on the verge of announcing a campaign with Google TV which will likely see a huge spike in connected TV usage across all networks. Especially KT’s in its domestic arena.

In the latest move, as reported by the Reuters news agency, the leading Korean Internet provider is demanding a cut of what are predicted as significant revenues as connected TV  rapidly becomes entrenched as part of the TV ecosystem. The agency reported KT executive Kim Hyo-sil as saying:  “We want the value of our network recognised by (Internet TV) platform operators and want to create a business model that enables us to share profits generated from using our networks…Those Internet-TVs can be likened to heavily-loaded trucks dominating network highways and slowing down the overall speeds, and the issue only becomes more serious as the Internet TV market grows.”

In response, Samsung, perceived by many as the connected TV leader, rebutted KT’s assertion and declared that net neutrality should prevail even for online  TV and connected TV services. In a statement, the company regarded KT’s demands as unreasoned. It said: “Samsung is a pure manufacturer making TVs, smartphones and computers. It’s not logical to demand network fees from a manufacturer that makes products using networks.”