There was a National Assembly note that Coupang's paid subscription service, Wow Membership, could go beyond a simple membership to lock consumers into its own ecosystem and serve as a tool to expand influence secured in the shopping market into adjacent markets such as delivery and online video service (OTT). The National Assembly Research Service recently, through a related report, identified this structure as a key issue in the platform competition order and suggested that institutional discussion is needed.
According to the retail industry on the 17th, the National Assembly Research Service, in a report on the 12th titled "Issues and tasks of the platform market transaction order seen through the Coupang case," noted that bundled memberships have the advantage of providing consumers with price reductions and convenience, but at the same time can create a "lock-in" effect that keeps users within a particular platform ecosystem.
Coupang's Wow Membership offers a single subscription that bundles various services, including Rocket Delivery benefits, free delivery on Coupang Eats, and access to the online video service (OTT) Coupang Play.
As consumers who signed up for shopping naturally go on to use delivery and content services, the incentive to move to other platforms decreases, and as a result, the user base secured in the shopping market can expand into adjacent markets.
The National Assembly Research Service said, "Service expansion through bundled products enhances consumer benefits, but from the perspective of the platform competition order, it is also necessary to examine the possibility of transferring market influence." In particular, it assessed that a complex business model in which a platform acts as an intermediary and at the same time performs the roles of a seller and a content operator is creating new competition issues that are difficult to explain under existing fair trade rules alone.
In addition to Wow Membership, it also mentioned suspicions that Coupang favors its own private-brand (PB) products, controversy over exposing its own products through search algorithms, and suspicions that Coupang Eats demanded most favored nation (MFN) treatment. It explained that all of these cases are structural problems that can arise when platform operation authority is combined with the operator's interests.
Other domestic platforms are also increasing user loyalty through memberships. Naver Plus Membership is operated by combining shopping rewards and digital content benefits. However, the National Assembly Research Service analyzed that, as with Coupang, it is necessary to separately examine the impact on competition in the domestic platform market of a structure that bundles shopping along with delivery and OTT into a single subscription service.
Similar issues are also major regulatory targets overseas. The European Union (EU) is continuously monitoring acts of securing competitive advantage by combining core services of digital platforms with adjacent services, and has raised issues from a competition law perspective over actions such as Meta favorably connecting Facebook users to its own Marketplace. In the United States, the Federal Trade Commission (FTC) and law enforcement are steadily reviewing whether the bundling strategies and ecosystem expansion of large platforms such as Amazon Prime hinder market competition.
However, some say it is difficult to see integrated memberships themselves as a problem. Providing multiple services under a single subscription can increase consumer welfare and convenience.
A platform industry official said, "From the consumer's standpoint, being able to use multiple services with a single subscription offers great convenience and expense savings," adding, "We understand concerns about the impact on market competition and that it is difficult for the government or public institutions to prepare related guidelines, but at the same time, integrated memberships also play a role in growing the market itself."
Experts advised that rather than the service bundling itself, the focus should be on whether a market-dominant operator uses it to make it difficult for competitors to enter or to restrict consumer choice.
Lee Jong-woo, a professor in the Department of Distribution and Marketing at Namseoul University, said, "Bundled products like Wow Membership can provide consumers with benefits such as discounts and convenience in the short term, but we also need to examine the possibility that they could hinder market competition in the long term," adding, "Even if it appears to be a consumer benefit on the surface, once the market is monopolized, the burden can return to consumers through price increases or reduced choices."
Lee added, "For practices such as tying that could distort market competition, it is necessary to prepare clear guidelines and standards to respond," and "As various platforms in Korea, including Naver, are using membership strategies that combine diverse services, what is needed is a discussion on how to design the competitive order of the platform industry as a whole, rather than treating it as the problem of an individual company."