Dan Clancy, CEO of Twitch, announced that the streaming service is leaving South Korea due to high costs of maintaining operations. The closure is scheduled for February 27, 2024.
The reason lies in the experiment that the South Korean government is conducting in the country – charging fees from the largest services in favor of local providers. Previously, Twitch management took a number of measures to reduce costs in this country: they disabled the ability to view broadcast recordings, limited the maximum video quality to 720p, and switched to a peer-to-peer system to maintain the quality of broadcasts. The company’s lawyers dealt with the issue separately, but it was not possible to reach an agreement with local representatives, and the fee for using the network in Korea remained 10 times higher than in most other countries.
“We want to make clear to all of our global communities that this is a unique situation. Operating costs in Korea are significantly higher than in other countries, and we have been openly talking about this problem for a long time.” — Dan Clancy, CEO of Twitch.
Deng’s concerns are understandable, as lawmakers in Russia, Europe and the United States are discussing the introduction of similar fees.
But in the case of South Korea, everything is not so bad. YouTube and AfreecaTV are present in the local market, and the South Korean company Naver has already reported about creating its own streaming service CHZZK (치지직). You can already apply for participation in testing, which will begin on December 19. It is planned to launch open testing in February 2024, and a full release will take place closer to the second half of the year.
South Korean streamers are saddened by the development of the situation, but are now forced to look closely at alternative options. There are suggestions that Naver’s alternative may only be promising within the country.