Why is Twitch Leaving South Korea?
In a recent blog post, Twitch CEO Dan Clancy announced the platform’s decision to shut down operations in South Korea on February 27. The move comes in response to the daunting operational costs faced by the streaming giant in one of the world’s largest esports markets.
Network Cost Reduction Efforts: Despite considerable efforts to mitigate network costs, Twitch details its attempts, including experimenting with a peer-to-peer model for source quality and adjusting the maximum source quality to 720p. However, these measures proved insufficient, with Clancy revealing that operating in Korea remained ten times more expensive than in most other countries.
The Unique Situation in South Korea: Clancy emphasizes the distinctive challenges faced in Korea, terming the cessation of operations as a “unique situation.” The blog post sheds light on the complexities that led to this difficult decision.
Financial Strain and Unsustainability: Twitch, owned by Amazon, admits to sustaining significant losses in Korea, and despite efforts, there is “no pathway forward” to operate the business sustainably in the country. This section delves into the financial strain faced by Twitch in the Korean market.
More Details at https://techcrunch.com/2023/12/05/twitch-to-shut-down-in-korea-over-prohibitively-expensive-network-fees/
Twitch shutting down in Korea seem like it's going to keep Sykkuno up at night when it comes to the future of streaming as a career. pic.twitter.com/0rQsANnRr7
— Pathwatcher (@DionShield) December 6, 2023
Unraveling the Network Fee Mystery: While the specific reasons for the exorbitant network fees in South Korea remain unclear, there is speculation linking it to recent controversial discussions in the country. Clancy’s remarks hint at potential connections to proposals requiring tech companies to bear network costs.
CEO’s Perspective: In his statement, Clancy expresses the difficulty of the decision and disappointment. He acknowledges the special role of Korea in the international esports community and expresses gratitude for the communities built on Twitch in the country.
Industry Impact and Future Watch: The impending closure of Twitch operations in South Korea raises questions about potential implications for other streaming platforms in the region. This section explores the broader impact on the esports community and speculates on future developments.
Conclusion: As the esports landscape in South Korea faces a significant shift with Twitch’s withdrawal, the industry will undoubtedly closely monitor unfolding developments and assess the repercussions for streaming platforms operating in this dynamic market.
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