S.Korea broadband firm sues Netflix after traffic surge from ‘Squid Game’

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Seoul, Oct 1 (Businesshala) – South Korean Internet service provider SK Broadband has sued Netflix (NFLX.O) over increased network traffic and maintenance work due to increased viewership for the American firm’s content , an SK spokesperson said on Friday.

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The move comes after a court in Seoul said that Netflix should pay an Internet service provider something in return for network use, and several South Korean lawmakers have spoken out against content providers that continue to generate explosive traffic despite network usage. do not pay for.

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A Netflix spokesperson did not immediately comment on the lawsuit.

The popularity of the hit series “Squid Game” and other offerings has underscored Netflix’s position as the country’s second-largest data traffic generator after Google’s YouTube, but the only two to not pay network usage fees, which Other content providers such as Amazon, Apple and Facebook are paying, SK said.

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Netflix’s data traffic handled by SK grew 24 times from May 2018 to 1.2 trillion bits of data processed per second by September, SK said, riding on the success of several Netflix productions from Korea, including “Squid Game” and “DP”. ” Are included.

SK Broadband said it has filed a lawsuit against Netflix for paying to use SK’s network after Netflix began using SK’s dedicated line from 2018 to allow viewers in Korea to connect to servers in Japan. To deliver large amounts of data-heavy, high-definition video content. Hong Kong.

Last year, Netflix brought its own lawsuit over whether it had any obligation to pay SK for use of the network, arguing that Netflix’s duty ends with creating content and leaving it accessible. It said SK’s expenses were incurred while meeting its contractual obligations to Internet users, and that delivery in the Internet world is “free as in principle”, according to court documents.

But the Seoul Central District Court ruled against Netflix in June, saying that SK is seen as “a service provided at a cost” and that Netflix is ​​”obligated to provide something in return for the service”. To be “appropriate”.

The court document said SK estimated that Netflix would have to pay about $27.2 billion ($22.9 million) in 2020 alone to pay network usage fees.

Netflix has appealed against the ruling, court records showed, with new proceedings beginning in late December.

Netflix said in a statement on Wednesday that it has contributed to the creation of about 16,000 jobs in South Korea, an investment of about 770 billion won, as well as an economic impact of about 5.6 trillion won.

Ruling party lawmaker Kim Sang-hee said on Wednesday that 78.5% of South Korea’s top 10 data traffic generators came from foreign content providers, up from 73.1% a year ago, including “Google-YouTube and Netflix”. , who are responsible for it. Majority of the networks turn a blind eye to the usage charges”.

($1 = 1,187.3400 won)

Reporting by Joyce Lee; Editing by Raju Gopalakrishnan

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