SEOUL: US-based live gaming streaming platform Twitch said Dec 6 that it would stop its service in South Korea in February because of “seriously” high network costs.
In a statement signed by CEO Dan Clancy, the Amazon-owned company said it had reached a stage where continued operation in the country had become “impossible”.
It blamed Seoul’s network usage fees for the decision, saying costs were “10 times higher compared to the majority of other countries”.
“Twitch operations in South Korea are scheduled to end on February 27, 2024,” the statement said.
“The cost of running Twitch in South Korea is currently seriously high.”
The company said in March it would cut more than 400 jobs “to ensure we protect our business in order for Twitch to be around for a long time”.
The platform said it has “put a lot of effort into finding ways to continue operating in South Korea by reducing costs”, such as adjusting the maximum video quality, but it no longer became sustainable.
With its real-time and interactive nature, Twitch has gained significant traction and established a strong presence among gamers in South Korea.
The country is known for its passionate, competitive, and dedicated gaming community, as well as its megastar Faker – a gamer hailed as the Michael Jordan of esports.
“We would like to reiterate that this was a very difficult decision, and one that all of us at Twitch are deeply saddened by,” the company’s Wednesday statement said.
“South Korea has always been a stellar player in the global esports community and will continue to do so.”
Unlike many other countries, South Korea allows Internet service providers to charge data-heavy companies extra fees.
South Korea has had legal disputes with US streaming titan Netflix over the resulting network usage fees.
In September, Netflix and SK Broadband – one of South Korea’s biggest Internet service providers – announced they would drop a multi-year series of lawsuits over network usage fees.
The disputes centred around whether Netflix should pay for costs from increased network traffic and maintenance efforts, but the two said they would now instead “collaborate as partners for the future”.
Shares in South Korean video streaming service Afreeca TV, Twitch’s competitor, soared almost 30% in afternoon trading in Seoul.
Some of the country’s Twitch users were devastated by the news.
One streamer, yummy_2 said: “It feels like losing my job right now.” – AFP