Jun 23 (Japan Today) - Japan's antitrust watchdog will soon conclude that four-year installment payment plans for smartphones offered by major phone carriers in the country is legally problematic, sources close to the matter said Friday.
The Japan Fair Trade Commission views the payment plan of KDDI Corp and SoftBank Group Corp for the iPhone and other mobile devices as depriving customers of options to choose other carriers and potentially leading to a violation of the antitrust law, according to the sources.
Working together with the communications ministry, the antitrust watchdog is expected to request that phone carriers take corrective measures.
Under the four-year plans, the carriers sell the iPhone or other devices to customers by splitting the price across 48 months. But the remaining two years of the four-year term can become free of charge if they decide to switch devices and sign a new four-year payment plan with the same company.
If the customers decide not to switch devices and sign new contracts after two years, they are charged for the remaining two years, effectively discouraging them from changing carriers or terminating their current plans.
In a report, the watchdog plans to say that the payment scheme "effectively deprives customers of their right to choose," the sources said.
Critics have said the plans impede competition among phone carriers and lead to fees remaining high in the Japanese market dominated by KDDI, SoftBank and NTT Docomo Inc.
