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South Korean broadband firm sues Netflix after traffic surge from Squid Game

South Korean broadband firm sues Netflix after traffic surge from Squid Game

The Netflix series "Squid Game" is played on a mobile phone in this picture illustration taken September 30, 2021. REUTERS/Kim Hong-Ji/Illustration

Last year, Netflix had brought its own lawsuit on whether it had any obligation to pay SK for network usage, arguing that Netflix's duty ends with creating content and leaving it accessible.

It said that SK's expenses were incurred while fulfilling its contractual obligations to Internet users, and delivery in the Internet world is "free of charge as a principle", according to court documents.

But the Seoul Central District Court ruled against Netflix in June, saying that SK is seen as providing "a service provided at a cost" and it is "reasonable" for Netflix to be "obligated to provide something in return for the service".

SK estimated that the network usage fee Netflix needed to pay was about 27.2 billion won (US$22.9 million) in 2020 alone, the court document said.

Netflix has appealed against the ruling, court records showed, with fresh proceedings to start in late December.

Netflix said in a statement on Wednesday that it contributed to the creation of about 16,000 jobs in South Korea stemming from about 770 billion won in investments, as well as an economic effect of about 5.6 trillion won.

Ruling party lawmaker Kim Sang-hee said on Wednesday that out of South Korea's top 10 data traffic generators, 78.5 per cent of the traffic came from foreign content providers, up from 73.1 per cent a year earlier, with "Google-YouTube and Netflix that account for the majority turning a blind eye to network usage fees".

Source: Reuters/kg

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