Samsung probed for allegedly bashing rival HTC online

The tech giant allegedly hired students to tout Samsung smartphones while posting negative comments about HTC devices -- a Taiwanese commission says this is equal to false advertising.

Dara Kerr Former senior reporter
Dara Kerr was a senior reporter for CNET covering the on-demand economy and tech culture. She grew up in Colorado, went to school in New York City and can never remember how to pronounce gif.
Dara Kerr
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HTC's One (left) and Samsung's Galaxy S4 (right). Sarah Tew/CNET

The Taiwanese Fair Trade Commission has reportedly launched an investigation into Samsung on allegations that the phone-maker was paying students to post negative online comments about HTC devices, according to AFP. HTC is one of Samsung's most staunch rivals.

Supposedly, the South Korean tech giant hired students to both write the inflammatory comments about HTC products and also recommend Samsung cell phones. The commission says that this type of behavior is akin to false advertising. According to AFP, the Fair Trade Commission spokesman Sun Lih-chyun said, "The case was set up last week after we received complaints."

For its part, Samsung has said that what happened was "unfortunate" and it occurred because there was "insufficient understanding" of the "fundamental principles" of the company's online procedures. The company also said that it has stopped all marketing that "involves the posting of anonymous comments."

Here is Samsung's official statement on the matter that was sent to CNET by a company spokesperson:

Samsung Electronics remains committed to engaging in transparent and honest communications with consumers as outlined in the company's Online Communications Credo. We have encouraged all Samsung Electronics employees worldwide to remain faithful to our Credo. The recent incident was unfortunate, and occurred due to insufficient understanding of these fundamental principles.

Samsung Electronics Taiwan (SET) has ceased all marketing activities that involve the posting of anonymous comments, and will ensure that all SET online marketing activities will be fully compliant with the company's Online Communications Credo.

We regret any inconvenience this incident may have caused. We will continue to reinforce education and training for our employees to prevent any future recurrence.

According to AFP, the alleged campaign happened via a local advertising agency hired by Samsung. If Samsung and the agency are found to have practiced false advertising, they face a fine of up to $835,000.

This won't be the first time Samsung would be fined by Taiwan's Fair Trade Commission. According to AFP, the company was fined around $10,000 earlier this year for allegedly engaging in misleading advertising about its Galaxy Y Duos. Samsung was also fined $16.2 million in January by China's National Development and Reform Commission over charges that it colluded with LG and four Taiwanese firms to fix the prices of LCD panels.