Gov't to inspect YouTube, Netflix over rate hikes

This image shows an introduction page of YouTube Premium service, a subscription service which allows users to view video streaming content without advertisements for a monthly charge of 10,450 won ($8). YouTube recently announced its decision to increase the monthly subscription fee to 14,900 won. Captured from YouTube

The government will inspect YouTube and Netflix over irregularities in service fee increases and service policy changes, the Korea Communications Commission (KCC) said Thursday.

Kim Hong-il, chairman nominee of Korea Communications Commission / Yonhap

YouTube recently announced that it increased the monthly subscription fee for YouTube Premium, a service that allows users to enjoy video streaming without ads, by 43 percent from 10,450 won ($8) to 14,900 won. This comes three years after it raised the price from 8,690 won to 10,450 won in September 2020.

Netflix has not recently raised its subscription fees. But in November, the company informed Korean account owners of an additional 5,000 won fee for the sharing of an account between people who do not live together.

The telecommunications regulator announced that it will check whether service operators like YouTube and Netflix have violated the Telecommunications Business Act in relation to price increase, terms of use and user notifications.

"If violations are confirmed through the inspection, we plan to switch to fact-finding, and if the violations are confirmed as a fact, we plan to take action according to the relevant laws," the KCC said.

The Yoon Suk Yeol administration has been urging digital service operators to provide reasonable service configurations and prices so that customers can use the services at affordable prices.

As a result, the nation's mobile carriers launched various types of 5G network plans, and smartphone makers will launch devices priced between 400,000 and 800,000 won next year.

ICT Minister Lee Jong-ho recently pointed out that Google and Netflix should have undergone processes to gain understanding from consumers about raising their service subscription fees.

"The ICT ministry has been negotiating with mobile carriers to reduce telecommunications costs, but the burden on users has increased as Google and Netflix have raised their fees," Lee told reporters during a press conference in Sejong on Monday. "It would have been better if they explained why they had to raise prices and went through the process of making it understood."

He pointed out that no matter how much the government attempts to reduce telecommunications costs, it is still difficult to reduce the cost of digital services that consumers have to bear each month if Big Tech companies raise their fees.

"Even if they raise the use fee, I think there should have been an explanation (so people can decide) whether it is a reasonable amount (or not). It's not easy for the government to force them to do anything, but I want them to explain so that the increase in user benefits and costs can be understood," the minister said.