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Netflix, SK Broadband bury the hatchet on Network traffic costs

Both sides announced a strategic partnership in which they will offer various price plans and products, including bundled packages.

South Korean telecom company SK Telecom and Netflix have put an end to their long-drawn legal battle. Both sides have dropped their respective lawsuits and have instead announced a strategic partnership in which they will offer various price plans and products, including bundled packages.

A timeline of events:

  • November 2019: SK Telecom asked the Korean Communications Commission to look into whether Netflix should be required to pay the telco for increased network traffic.
  • April 2020: Netflix refused to pay the charge and instead, filed a lawsuit against SK Telecom. It argued that its subscribers were already paying the telco to access the internet. 
  • June 2021: The Seoul District court ruled against Netflix saying that the the broadband company’s offerings are “a service provided at a cost” and it is reasonable for Netflix to be obligated to provide something in return for the service. Netflix still refused to pay and filed an appeal. 
  • October 2021: SK Telecom counter-sued Netflix saying that it had been using SK’s dedicated line (a communications cable or other facility dedicated to a specific application) since 2018 to deliver copious amounts of data-heavy, high-definition video content to viewers from servers in Japan and Hong Kong. 

Between March 2022 and April 2023, the case had 18 hearings and was ongoing even as of earlier this month (as noted by Korea University School of Law Professor KS Park in an interview with MediaNama).

What does SK Telecom and Netflix’s partnership entail?

  • Netflix will be bundled with SK Telecom’s plans and SK Broadband’s (subsidiary of SK Telecom) Internet Protocol TV offerings. (Quick context: IPTV is a service that provides television programming and other video content through internet protocol) 
  • Additional Netflix bundle packages will be introduced for SK Telecom’s subscription service, T Universe.
  • The duo will also explore opportunities to leverage AI technologies developed by SK Telecom and SK Broadband, such as Conversational UX and Personalized Recommendation Technologies. 

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