With SK Telecom kicking things off, year-end personnel reshuffles in the telecom industry are set to begin. This year, a string of major hacking incidents is expected to affect personnel moves across the sector. Although the telecom business has been assigned the responsibility of managing the national key telecommunications network, which is essential to public life and safety, many say the corporations failed to fulfill their responsibilities.
According to the industry on the 29th, SK Telecom President Ryu Young-sang appears likely to move to a new post. It comes four years after taking office as SK Telecom's chief executive officer (CEO). The telecom industry is watching whether Ryu will take on a new role leading new businesses such as artificial intelligence (AI) at the SK SUPEX Council, or step back by taking responsibility for this year's hacking incident.
SK Telecom's operating profit fell to 338.3 billion won in the second quarter, down 37% from a year earlier due to the fallout from the hacking incident. At the end of Sept., it reduced its 2030 AI business revenue target from the previously released 1.05 trillion won to 500 billion won. However, since Ryu is leading the group's AI strategy, there is also a possibility he will continue overseeing AI investments and take on a key role.
KT President Kim Young-shub is effectively expected to give up seeking another term. KT is being criticized not only for poor management of femtocells (small base stations), which drew controversy, but also for shortcomings in its incident response. After identifying the incident, KT not only delayed reporting to the Korea Internet & Security Agency (KISA) despite signs of a server breach, but also disposed of some servers where hacking had occurred.
Kim's term runs until KT's shareholders meeting in Mar. next year. On the 21st, regarding the hacking incident, he said he would take responsibility "when the situation is brought under control." Asked about the scope of responsibility, he said he would "take responsibility, including resignation," signaling his intention to forgo another term.
Depending on when Kim steps down, attention is also turning to the timing of KT's executive appointments and organizational reshuffle. In 2018, when former Chairman Hwang Chang-gyu was reappointed, KT moved up a large-scale executive reshuffle to mid-Nov. However, former CEO Koo Hyun-mo's bid for another term fell through in 2022, and executive appointments were delayed until after Kim Young-shub took office the following year.
LG Uplus President Hong Bum-Shik is expected to stay on, as it has been only about a year since taking office as CEO. However, many say the impact of the incident still bears watching, as LG Uplus also submitted a report to KISA on the 23rd indicating signs of a server hacking breach. LG Uplus said it has "found no abnormal signs and no confirmation of any breach incident."
Ryu Young-jae, CEO of Sustinvest, said, "When a crisis occurs, what matters is how a trustworthy actor conducts an objective and thorough investigation process and handles the aftermath," adding, "What lessons were learned from the crisis and how to embed preventive measures into corporate management is important."