© Reuters. FILE PHOTO: Youngsters playground miniatures are seen in entrance of displayed Twitch emblem on this illustration taken April 4, 2023. REUTERS/Dado Ruvic/Illustration/File Photograph
By Hyunsu Yim
(Reuters) – Amazon (NASDAQ:)’s streaming unit Twitch on Tuesday stated it’ll shut down operations in South Korea in February subsequent 12 months, as a consequence of excessive working prices and community charges.
“Twitch has been operating in Korea at a significant loss, and unfortunately there is no pathway forward for our business to run more sustainably in that country,” CEO Dan Clancy stated in a weblog.
Community charges in Korea are nonetheless 10 occasions costlier than in most different international locations, he stated, including that the corporate spent vital effort working to cut back working prices to stay in enterprise.
South Korea’s Ministry of Science and ICT (Info and Communication Know-how) stated in an announcement that community utilization charges had been being reviewed as “a comprehensive matter that requires consideration of the sustainable development of the internet network, the content industry and user convenience”.
The ministry didn’t remark instantly on Twitch’s determination to finish its operations.
The controversy over who ought to foot the invoice for elevated site visitors utilization has seen world know-how giants conflict with native web suppliers in South Korea.
Earlier this 12 months, Netflix (NASDAQ:) and South Korean web service supplier SK Broadband withdrew lawsuits towards one another over community utilization charges.
In 2022, Twitch restricted video decision in South Korea, a rustic with a booming esports scene and use of on-line videogames, citing rising working prices.
Shares of Afreeca TV, a South Korean streaming platform and competitor, closed up practically 30 p.c on Wednesday following the announcement.
Twitch had laid off greater than 400 staff in March after its consumer and income development didn’t meet expectations.
