Twitch, the popular video streaming service, announced that it will shut down its operations in South Korea next year. Despite its previous dominance in the South Korean gaming market, Twitch has been grappling with high operating costs, leading to this difficult decision.
Despite competition from local services like AfreecaTV and global giants like YouTube, Twitch managed to captivate gamers in South Korea. With approximately 35 million daily visitors worldwide, this platform, owned by Amazon, held a significant position in the country's gaming community.
Impact of Video Quality Downgrade
However, as per the New York Times, Twitch's popularity waned due to a video quality downgrade to 720p resolution. While this measure was undertaken to reduce operational expenses, it had an adverse effect on text legibility, causing users to flock to YouTube for a better viewing experience.
Ha Jae-pil, a professor of e-sports at Kookje University in South Korea, acknowledged that Twitch's influence diminished, according to Reuters. Twitch exclusively streamed particular League of Legends, Overwatch, and Apex Legends tournaments, firmly establishing its presence in the country.
Difficult Decision and Real Impact
Twitch has scheduled its South Korean business shutdown for February 27, 2024. The company cited exorbitant network fees in South Korea as a critical factor in its decision. Despite implementing cost-cutting measures, Twitch emphasized that network fees in South Korea remain ten times higher than in most other countries. Faced with substantial financial losses, Twitch reluctantly concluded that there is no viable path to sustainability for its operations in the nation.
South Korea has witnessed legal disputes arising from its high network usage fees. These escalating costs further contributed to Twitch's termination of its services in South Korea.
Twitch's chief executive, Daniel Clancy, shared on social media that the choice to shut down operations in South Korea was challenging, acknowledging that the decision had been delayed for some time. Clancy expressed awareness of this move's impact on the South Korean gaming community.
Despite this, Twitch aims to support South Korean streamers during the transition by lifting the ban on broadcasting streams simultaneously on another platform. The company also encourages streamers to share links to their channels on alternative services.