Twitch has now announced that it will be shutting down its business in South Korea.
👉 Background: Twitch is the live streaming service that broadcasts esports, music, and creative content. It was launched in 2011 as Justin TV and three years later, was bought by Amazon for a whopping $970 million USD.
👉 What happened: Twitch has now announced that it will be shutting down its business in South Korea, aka the world's biggest esports market. And, it's all because the network costs in South Korea have become too expensive for Twitch to cover.
👉 What else: In South Korea, Twitch needs to pay a tax to use the local network. As a result, it's facing operational costs ten times higher in South Korea than other countries. And other countries could soon follow suit.
💡The era of tech companies getting free connectivity could be coming to an end.
💡South Korea's unique tax model requires tech giants to pay a fee for delivering content to end-users. That's because these tech companies, and their large usage, are contributing to the clogging of the internet in South Korea.
💡And now, this approach could be setting a new global precedent:
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