Twitch has made the surprise announcement that they are pulling their business out of Korea.
In a blog post, Twitch CEO Dan Clancy revealed that they will be out of the country by February 27, 2024.
In Dan’s words:
“Ultimately, the cost to operate Twitch in Korea is prohibitively expensive and we have spent significant effort working to reduce these costs so that we could find a way for the Twitch business to remain in Korea.
First, we experimented with a peer-to-peer model for source quality. Then, we adjusted source quality to a maximum of 720p.
While we have lowered costs from these efforts, our network fees in Korea are still 10 times more expensive than in most other countries.
Twitch has been operating in Korea at a significant loss, and unfortunately there is no pathway forward for our business to run more sustainably in that country.”
To be clear, this is not about being able to watch Twitch in Korea. What this is is the partner program that allows Koreans in the country to stream in Twitch and monetize their channels. If you are watching Twitch from in Korea, you will also no longer be able to make purchases on Twitch’s platform, such as Subscriber Badges and emotes.
Now, you may be wondering what the big deal about all this is. And what it is is that Korea is a major esports hub. Esports is on a different level in the country, with regular TV exposure since the early 2000s, separate government and military sponsorship programs, and even university and high school esports programs.
On a more relatable level, Korea is home to many major esports tournaments and teams. Some of the teams based in the country include DRX, T1, and Kwangdong Freecs. Tournaments that they have hosted include MSI 2022 (for League of Legends) and PUBG Nations Cup 2023.
This will obviously have reverberating effects on esports, not only in Korea, but around the world. Many of those esports teams and individual players relied on Twitch as part of their business, and now that is seemingly going away.
It certainly makes one wonder why Korea’s local esports industry did not intervene on Twitch’s behalf with the Korean government, possibly as part of their Hallyu culture initiative. Well, we may find out in the coming days if they did try something like that and it didn’t work out, as Dan also revealed they will be hosting streams to answer community questions, in and out of Korea.
