FTC fines cable TV operators over false advertising

By Camaron Kao  /  Staff reporter

Thu, Aug 29, 2013 - Page 13

The Fair Trade Commission (FTC) yesterday fined cable TV operators Kbro Co (凱擘), TFN Media Co (台固媒體) and 18 others a total of NT$3.8 million (US$126,800) for false advertising.

It is the first time the commission has punished cable TV operators, FTC Vice Chairman Sun Lih-chyun (孫立群) said.

In June last year, TFN Media and five TV system operators under it told consumers through pamphlets and bus advertisements that Chunghwa Telecom Co’s (中華電信) multimedia-on-demand (MOD) digital TV service did not include certain TV channels. They also said that clients who wanted to cancel their MOD subscription would have to pay an early termination fee of NT$1,800 to Chunghwa Telecom.

Kbro and its 12 subsidiaries, as well as another operator based in southern Taiwan, later made similar claims.

“These companies used the advertising at a time when many customers wanted to shift to Chunghwa’s MOD to watch the Olympic Games in London,” Sun said.

The ads did not say that the NT$1,800 termination fee was the maximum penalty for cancellation, Sun said, because the actual termination fee varies depending on the length of the service contract.

The commission also said the cable operators failed to inform suscribers that they charged a non-refundable service fee to install their equipment.

The advertisements had damaged competition in the local market, where there are only one or two service providers in any specific region or area, the commission said.

TFN Media was fined NT$500,000 because it was the first to launch the misleading advertising campaign, while Kbro was fined an equal amount because of its large market share, Sun said. The other operators were fined between NT$100,000 and NT$200,000 based on their market share, he said.

The companies only ended their unfair advertising in July last year after the Olympics were over and because they were notified that Chunghwa Telecom had sued them, Sun said.

Kbro and its 12 subsidiaries account for a 20.99 percent share of the nation’s subscription TV market, while TFN Media and its five subsidiaries have a 10.23 percent share, according to the commission.