Court takes Facebook's side against media regulator

The Korea Times

The Korea Times

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Tue, September 26, 2023 | 07:20

Law & Crime

Court takes Facebook's side against media regulator

Posted : 2019-08-22 17:01

Updated : 2019-08-22 18:54

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By Lee Suh-yoon

The Seoul Administrative Court ruled in favor of Facebook over a fine the Korea Communication Commission (KCC) imposed on the social media giant last year for what it considered "a deliberate slowdown" of services, Thursday.

The court concluded Facebook did not intend to slow down the services, saying the KCC's administrative measures taken against the company, including the fine, should be cancelled.

In December of 2016, Facebook redirected some of SK Broadband's and LG Uplus's network connections to overseas servers, causing service delays to some Korean users. The rerouting happened after regulatory changes made it trickier for the SK Broadband and LG Uplus users to borrow KT's existing cache server. Facebook rerouted the network connections to its Hong Kong server without giving prior notice while it was still negotiating with each telecom company on how to share the costs for the new cache servers, according to SK Broadband and LG Uplus officials.

In March the following year, the KCC decided Facebook's move counted as a deliberate disruption of network services to gain the upper hand in network cost negotiations, and slapped a 396 million won ($328,000) fine on the social media giant. Facebook, which claims it did not anticipate service disruptions from the rerouting, took the case to court.

"The plaintiff (Facebook) could not foresee the rerouting would disrupt the network service and has no reason to block Facebook users from its service. On principle, the content provider also has the right to freely redirect network routes," the court said.

"We welcome the court's decision. Facebook will continue its efforts to protect Korean users," Facebook said in a statement released right after the verdict.

The ruling is a blow to the KCC's plans to issue formal guidelines on network fees. The guidelines would give Korean network providers the legal grounds to charge content platforms for their data traffic. Industry sources say global content platforms like Facebook, YouTube and Netflix ― that have more platform power than domestic content providers ― pay considerably less or not at all for network access under existing business contracts. Domestic search engine Naver, for example, pays over 70 billion won to use the network each year, according to disclosed company records.

The KCC said it will appeal the court's decision.

"The ruling worries us because the rules and conditions should be the same for both domestic and foreign content providers," Jin Sung-chul, a KCC official, told reporters outside the courthouse.

Domestic IT platform companies, however, don't necessarily agree with the KCC's stance, as the gap in network usage fees for foreign and domestic content providers are determined by private business contracts that reflect each content provider's platform power, not government regulation.

"We don't really see this in the frame of 'discrimination against domestic firms,'" Kim Jae-hwan, a policy head at the Korea Internet Corporations Association, said in a phone interview. "The ruling confirms that the responsibility to ensure a quality network connection for users lies with the network provider, not the content provider."

sylee@koreatimes.co.kr