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Twitch Will Shut Down Its Streaming Platform in South Korea

An Update on Twitch in Korea

https://blog.twitch.tv/en/2023/12/05/an-update-on-twitch-in-korea/

This morning, I shared with our community in Korea that we’ve made the difficult decision to shut down the Twitch business in Korea on February 27, 2024 KST. We understand that this is extremely disappointing news, and we want to explain why we made this decision and how we are planning to support those impacted. Ultimately, the cost to operate Twitch in Korea is prohibitively expensive and we have spent significant effort working to reduce these costs so that we could find a way for the Twitch business to remain in Korea.

55 comments

Paradachshund

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Does anyone know why it's so expensive there?

Sabin10

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Lack of net neutrality is a huge part of it. Korean ISPs bill sites like twitch for the data they use.

p03locke

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This is good ammo for the fight for Net Neutrality, honestly.

PM_Your_Nudes_Please

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IIRC, South Korea charges an import tax for foreign media. It’s part of why Korea has become a sort of media powerhouse, with K-pop, K-dramas, K-comics, etc… Those things are much cheaper in SK because they’re all local and aren’t being charged that extra tax. So they’re naturally very popular in SK because they’re much cheaper. Sort of a positive feedback loop where the media is cheaper so people consume more of it, which makes the media popular enough to survive on its own outside of Korea as well.

roguetrick

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It's not about media or taxes, it's about inflated fees for traffic period. It's regulatory capture (which Korea has a long history of) and subsequent collusion by Korean ISPs. Prohibitively expensive to run a streaming service like that even if you have local datacenters to reduce international transit fees (because you still have to connect to the local ISPs who will still charge you). https://carnegieendowment.org/2021/08/17/afterword-korea-s-challenge-to-standard-internet-interconnection-model-pub-85166

Edit: To be clear, this sort of situation is about the only one where to effectively have a streaming service, you'd need to use peer to peer and make it "come from inside the house", so to speak. Even their local streaming services are over the barrel and only the ISPs themselves could actually make an affordable streaming service.

JohnWorks

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It's interesting that it's still classified as foreign media even if the streamers could be local. Wonder if there'll be a Korean twitch competitor that comes out of this.

pleb_maximus

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There is AfreecaTV. I don't think Twitch was a big competitor to them locally in the first place. At least from the little I know about it, so take that with an extra train of salt.

roguetrick

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Supposedly that service is P2P, so that's how they operate without the fees.

pleb_maximus

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That and they are a Korean company as far as I know.
They sponsor a Starcraft 1 League in Korea at least.

rigatti

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Love me some ASL.

pleb_maximus

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I do too. But I always get behind and have to binge it to get back up to date.

Currently binging Season 14. So I'll hopefully be up to date around christmas again.

redcalcium

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So, if the ISP eventually deployed cgnat and broke P2P, they'll going to be screwed, right?

lemmyvore

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I imagine they have CGNAT already. But you can run servers that only assist users to establish a connection handshake from behind CGNAT, then all traffic happens peer to peer.

Now, whether the ISPs can get away with blocking that handshake is another story...

Swedneck

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you can use p2p services behind cgnat, like how do you think torrent works?

redcalcium

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I'm behind cgnat myself and I can download but can't seed. If everyone is behibd cgnat the swarm would be dead fast. In Korea, there are only 3 ISPs and if they collude to use cgnat with client isolation, they can kill these P2P scheme used by streaming site and boost their profit sharing revenue.

Mac

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SPNP - Sending Network Party Pays
The party that creates the traffic pays the operating costs.

CluckN

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Damn I didn’t know it was 10x the cost. Crazy how a company that size still can’t handle the fees.

cerement

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more a matter of “don’t wanna” than “can’t”

glimse

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It says they operated at a loss in SK. If that's true, I wouldn't wanna, either.

WoodlandAlliance

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FeelzGoodMan420

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What the actual fuck are you talking about? A simple google search shows that Amazon very much makes a profit. Do some basic research first before posting bullshit please.

nave

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iegod

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Wha

schmidtster

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Dang, stores better get rid of their loss leaders than.

Sometimes you gotta take a small loss for the overall benefit of the company/system.

superduperenigma

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How is remaining in an unprofitable market a "loss leader"?

Sometimes you gotta take a small loss for the overall benefit of the company/system.

You really don't think Twitch did some analysis on this matter before making a decision? Or do you just figure that your uninformed assumptions about their financials are more accurate than their internal analysis? Clearly whatever benefit they were or were not getting from their SK business was not enough to justify the operating costs.

schmidtster

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Negative press costs money too. There will be unforeseen costs related to this move.

roguetrick

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They're leaving the market. If anything Amazon is putting a shot across the bow of the ISPs who are charging these interconnect fees to get THEM negative press and make the Korean public demand a change in the laws so they can get the Internet they pay for.

Amazon may be quitting twitch in Korea, but their cloud services are still paying for the dumb fees.

superduperenigma

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What negative press? They're no longer going to do business in a particular market for completely normal reasons. This isn't some kind of scandal, it's a standard decision for a company to make regarding unprofitable operations. Everyone besides you seems to understand this.

You clearly have no idea what you're talking about.

someguy3

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Loss leaders you know lead to something. Can't see what it would lead to.

superduperenigma

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Neither does the person you're replying to. They probably just learned the term "loss leader" and thought they'd sound smart bringing it up but have no idea how the concept actually works in practice.

someguy3

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Sounds like he needs to rightsize.

DeepFriedDresden

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Loss leaders work because customers will purchase other products/services. Operating in a market at a loss isn't what a loss leader is.

glimse

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I dunno man, neither of us are financial analysts for Twitch

iegod

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Gaming nerds dictating how business should operate is one of the funniest things to observe.

Maalus

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Or just remove what's costing you so much?

MolochAlter

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Can't remove a tax without lobbying or breaking the law.

cerement

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“corporation” + ~~“bribery”~~ “lobbying” … nope, never seen that before …
“corporation” + “breaking the law” … nor that one either …

MolochAlter

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Correct, but those are both expensive in their own ways.

If they don't see a return they won't do either.

schmidtster

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Which would cost you more in the end, so if removing it costs more, you keep it in.

That’s what’s a loss leader is…..

CluckN

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I also didn’t know that South Korea charges extra for foreign content providers which is also pretty aggressive.

sigmaklimgrindset

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Yeah, and it all started from a lawsuit between SK Telecom and Netflix because in 2020 people watching Squid Games in Korea used an unprecedented amount of bandwidth. Reuters article

Most telecom providers make deals with the big platforms regarding payment, but I guess S. Korea really wants Afreeca to be the only player in the streaming space. It could also be chaebol shenanigans.

DarkThoughts

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There's no "don't wanna" unless there's a "can't" due to not being able to make a profit. If they could they would. It's simple as that.

PrettyLights

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Companies don't just want to make a profit, they want to make the largest profit. Plenty of businesses turn down profitable ventures in pursuit of more lucrative returns.

DarkThoughts

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Why would they do that if they aren't mutually exclusive to one another? I'd get this notion if they'd started to do some sort of alternate way of providing for the SK market where their original platform would have been in the way but why close off profitable branches for no reason at all?

PrettyLights

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Because an organization or person only has so much bandwidth and attention. You can't infinitely scale to grab every bit of profit.

"Tripping over dollars to pick up pennies."

Chailles

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While true, that's not exactly relevant when it's a choice between losing a lot of money and not losing a lot of money.

CaptainSpaceman

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10x the cost of what tho? They just say "most other countries", but tahts just spin and essentially meaningless without more data

slazer2au

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That is surprising forthcoming from them.

Desistance

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Couldn't Koreans just VPN to another country?

Konraddo

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No need. Asian countries are not blocked from using Twitch. It's just Twitch won't have local business in Korea now.

mojo

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VPNs aren't the solution to shitty laws, nor can you expect that to be a valid mass solution

sigmaklimgrindset

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This’ll probably happen, anyone wanting to watch or stream on Twitch will probably just go through the Japanese servers. But Twitch isn’t that popular in Korea anyways, most of the Korea-based streamers on the platform have large foreign audiences.

roguetrick

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What's funny is Korean VPNs would be paying the fees to the ISPs instead, lol. ISPs still get their money.

redcalcium

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Which would be passed to their customers in the form of more expensive VPN price. Either way, the ISPs are the winner here, and I think someone mentioned that it's practically impossible to create a new ISP due to regulatory capture so there will be no competition to challenge the oligopoly.

Tom_bishop

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panchzila

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Are you trolling? Korea has a 97% literacy rate and is in the top 20 of best educated countries in the world.