Net regulator hints action against Netflix

Netflix Vice President of Public Policy Dean Garfield speaks at a press conference held at the JW Marriot Hotel Dongdaemun Square Seoul, Nov. 4. Yonhap

By Kim Bo-eun

Korea's broadcasting and telecom regulator implied Tuesday that it is open to working with its overseas counterparts in addressing the issue of getting content providers such as Netflix to pay network fees.

Netflix does not pay telecom companies to use their networks, which has become an issue for the network operators, given that the surge in traffic is requiring network upgrades and resulting in further costs.

Netflix Vice President of Public Policy Dean Garfield visited Seoul in early November to reiterate the company's stance to government officials and lawmakers: that it would not pay network fees. Korea Communications Commission (KCC) Vice Chairwoman Kim Hyun, in her meeting with Garfield, asked the U.S. entertainment platform to take responsibility.

"We believe there is some consensus around the world among regulators (that action needs to be taken)," a KCC official said. "But we are not at a stage where discussions are taking place."

The U.K.'s Office of Communications (Ofcom) launched a review in September into the country's net neutrality laws, to determine whether the framework passed in 2015 is in need of adjustments, considering users' and providers' needs. The COVID-19 pandemic has resulted in people spending more time at home, relying on broadband connections for entertainment.

Net neutrality refers to the principle that internet service providers (ISPs) treat all content providers equally and do not discriminate or charge differently based on user, content, platform or application. According to this principle, network operators have not been permitted to charge certain content providers more than others, but consensus is growing that circumstances have changed since the outbreak of the pandemic, and that changes need to be made accordingly.

Calls are growing around the world for content providers to pay for network traffic generated by the surge in viewers.

A total of 13 European telecom companies issued a joint statement, Monday, urging content providers to pay for using their networks.

The joint statement did not refer to specific content providers, but they are presumed to be Netflix and Google, the latter which operates YouTube and Facebook.

The list of European telecom companies are: Deutsche Telekom, VodaFone, Telefonica, Orange, KPN, BT Group, Telekom Austria, Vivacom, Proximus, Telenor, Altice Portugal, Telia Company and Swisscom.

"A large and increasing part of network traffic is generated and monetized by big tech platforms, but it requires continuous, intensive network investment and planning by the telecommunications sector," the joint statement said, according to Reuters.

"This model ― which enables EU citizens to enjoy the fruits of digital transformation ― can only be sustainable if such big tech platforms also contribute fairly to network costs."

In Korea, network operator SK Broadband is engaged in a suit with Netflix over network usage fees. Other telecom companies have not made explicit demands.

Korea's association of telecom operators is not currently considering collective action, an industry official said.

Netflix has contended that its Open Connect Appliances (OCA) are the answer to managing heavy data traffic on networks. Regional OCAs localize traffic, which alleviates congestion.

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