Twitch, the popular video streaming service, will shut down its services in South Korea next year, the company said Tuesday, after struggling for years with the “prohibitively expensive” costs of operating in the country.
Twitch was one of the most popular platforms for gamers in South Korea, even as it competed with domestic services like AfreecaTV and giants like YouTube, analysts say. The service, owned by Amazon, attracts about 35 million visitors a day worldwide, according to the company.
“Twitch was once in the driver’s seat among South Korean professional gamers for a while,” said Ha Jae-pil, an esports professor at Kookje University in South Korea. Some League of Legends, Overwatch and Apex Legends tournaments in the country were streamed exclusively on Twitch, he said.
then a degrade of video quality at a resolution known as 720p, which the company said reduced its operating costs, made text less readable and caused users to jump to YouTube, it said. “Twitch’s influence has weakened since then,” he said.
It now plans to close its business in South Korea on February 27, 2024. It was not immediately clear whether viewers in South Korea would maintain access to the platform. But the company said streamers in the country will no longer be able to monetize through Twitch and viewers will no longer be able to make purchases on the platform.
“While we have reduced costs through these efforts, our network rates in Korea remain 10 times more expensive than in most other countries,” the company said. “Twitch has been operating in Korea at significant losses and, unfortunately, there is no path forward for our business to operate more sustainably in that country.”
South Korea has charged foreign content providers higher network usage fees, prompting controversy and legal disputes. Netflix recently sued a South Korean Internet service provider, arguing that it had no obligation to pay network usage fees. In 2021, a court in Seoul upheld the supplier’s right to receive such fees.
“I don’t understand the higher fees for foreign content providers,” said Han Nam Hee, a sports professor at Korea University, adding that the country should give more opportunities to content providers, not less. “This is an unnecessary disruption to streaming and esports in South Korea at a time when it needs to continue growing globally.”
Daniel Clancy, CEO of Twitch, saying on social media that “this was a very difficult decision that we delayed for some time,” adding that he was “aware that this will have a real impact” on Korean streamers.
Signs of struggle on Twitch have gradually emerged over the past year as it cut its services in South Korea. After lowering the video resolution, Twitch in February began blocking South Korean streamers from posting. video on demand footage, a file of previously transmitted content. In March, the company fired more than 400 people.
Besides YouTube, Twitch has been the most used streaming service among South Korean gamers this year, according to Kiju Kim, an analyst at Hankook Research, a Seoul-based survey company. Twitch attracts about 300,000 South Korean viewers daily, about half of whom are men in their 20s.
Twitch said it would help South Korean streamers on the platform emigrate to alternative services by lifting the ban on simulcasting on another platform and encouraging them to share links to their channels on other services.
“Twitch is the most established gaming and streaming community, and losing it is unfathomable,” said Alexandria Brooks, an American graduate student in South Korea who has attracted more than 1,100 followers on Twitch while playing Pokémon, Lies of P and Baldur’s Gate. three times a week. “Hurts.”
Brooks, 28, said he was considering moving to YouTube but was concerned about retaining his American viewers, for whom Twitch remains the dominant streaming service. He was expected to lose several hundred dollars in monthly income.
“No one wants to be uprooted from what they are used to,” he said.