June 23, 2022

South Korea pressures Netflix to pay network usage costs

South Korean lawmakers have called for the swift passage of a bill that would force foreign content providers, including Netflix, to share the burden of network usage costs.

Netflix recently came under fire in South Korea for refusing to pay for network usage despite the traffic overload caused by its streaming service.

“Global content providers generate huge traffic and make high profits using local networks, but still refuse to pay network fees with great bargaining power in the market,” said Republican Jun Hye-sook. of the ruling Democratic Party at a seminar in Seoul.

She added that network traffic generated by foreign content providers, including Netflix and Google, accounts for nearly 80 percent of total usage in South Korea, Yonhap news agency reports.

Local internet service providers (ISPs), like SK Broadband, have been grappling with heavy data traffic amid the growing popularity of over-the-top services and have urged major content providers, like Netflix, to share the costs.

SK Broadband said Netflix’s traffic on its network jumped from 50 Gbps to 50 Gbps in May 2018 to 1,200 gigabits per second (Gbps) last September, part of explosive growth amid the popularity of Korean-language drama series, such as “Squid Game”.

‘Squid Game’ has helped push Netflix’s monthly active users in South Korea to an all-time high of 9.48 million in September 2021, since Netflix launched its streaming service in South Korea in 2016 , according to Nielsen KoreanClick.

Thomas Volmer, director of global content delivery policy at Netflix, refuted the idea that using Netflix somehow clogs up bandwidth for people at home.

Last September, SK Broadband filed a lawsuit against Netflix demanding network usage fees.

Several lawmakers here have proposed a bill that would block Netflix and foreign content providers from enjoying South Korean networks for free.



(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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