Twitch To Shut Down in Korea Over 'Prohibitively Expensive' Network Fees

Twitch, the popular video streaming service, plans to shut down its business in South Korea on February 27 after finding that operating in one of the world's largest esports markets is "prohibitively expensive." From a report: Twitch CEO Dan Clancy said the firm undertook a "significant effort" to reduce the network costs to operate in Korea, but ultimately the fees to operate in the East Asian nation was still 10 times more expensive than in most other countries. The ceasing of operations in Korea is a "unique situation," he wrote in a blog post.

South Korea's expensive internet fees have led to legal fights -- streaming giant Netflix unsuccessfully sued a local broadband supplier last year to avoid paying usage charges, but Seoul's court ruled that Netflix must contribute to the network costs enabling its half-billion-dollar Korean business. Twitch attempted to lower its network costs by experimenting with a peer-to-peer model and then downgrading the streaming quality to 720p video resolution, Clancy said. While these efforts helped the firm lower its network costs, it wasn't enough.