Acting top U.S. envoy voices concern over S. Korea’s move to legislate network usage fees

SEOUL-- South Korea's legislative move to make content providers, like Netflix and YouTube, pay for use of domestic internet service could give foreign companies and investors the wrong impression about doing business in the country, the acting U.S. ambassador to Seoul said Thursday.

Christopher Del Corso, the charge d'affaires ad interim at the U.S. Embassy in Seoul, also highlighted the need to bring regulatory frameworks in line with global standards.

"The recent legislation in the National Assembly regarding the digital economy may have some unintended consequences of signaling to foreign entities that their innovation and investment may not be welcome here," Del Corso said at a webinar hosted by the American Chamber of Commerce in Korea.

Last week, an opposition lawmaker introduced a bill that would require content providers to sign a contract with internet service providers on streaming their content by taking into account traffic and other relevant data.

Similar bills have also been pending in the National Assembly that would prevent Netflix and other overseas content providers from getting a free ride on the South Korean networks.

Netflix has been under fire in South Korea for refusing to pay for the use of the network despite huge traffic overload caused by its streaming service.

SK Broadband said Netflix's traffic on its network rose to 1,200 gigabits per second (Gbps) as of September last year from 50 Gbps in May 2018 in explosive growth amid the popularity of Korean-language drama series, such as "Squid Game."

"Squid Game" helped push up Netflix's monthly active users in South Korea to a record high of 9.48 million in September 2021, since Netflix launched its streaming service in South Korea in 2016, according to Nielsen KoreanClick.

In September, SK Broadband filed a lawsuit against Netflix to demand network usage fees, saying that the U.S. streaming giant did not come forward for talks even after a local court ruled in June last year that it is "reasonable" for Netflix to provide something in return for the service.

A recent report by the U.S. Trade Representative also addressed the same concern in light of "Korea's international trade obligations," and said that the U.S. will "continue to monitor Korea's legislative efforts."

Dean Garfield, Netflix's vice president for public policy, had planned to meet with South Korean lawmakers earlier this week to discuss the issue but the talks were canceled amid intense media coverage.

On the bilateral relations, Del Corso reaffirmed the two countries' strong ties "as natural partners" that can further deepen cooperation in areas like clean energy, technology and sustainable agriculture.

Del Corso also echoed Washington's call for Seoul to join the U.S.-led economic initiative being pushed for by the Joe Biden administration amid the growing rivalry with China.

"We must continue our cooperation in the Indo-Pacific ... focus on digital and emerging technologies, supply chain resilience, infrastructure, clean energy and decarbonization," he said. "We're looking to partners like Korea to join us and lead such cooperation through the newly announced Indo-Pacific Economic Framework."

Source: Yonhap News Agency