Twitch CEO DJ Clancy unexpectedly announced on December 5 that the streaming service will stop operating in South Korea on February 27, 2024. This was a big surprise not only to Korean streamers and viewers but the international community too. Here's what problems the platform faced and how its departure will affect the live streaming industry in the country.
South Korea is one of the most developed countries in terms of digital leisure. For many years, esports has been an official sport here, internet cafes for gamers are still popular, large international tournaments are regularly held, and some local professional players are the rea superstars in the country. The number of cell phones in Korea exceeds the number of residents, and high-speed internet is available in every part of the country.
All of these factors led to the rapid development of a digital content consumption culture in South Korea, with live streaming in particular. Twitch became the platform where one could watch personal broadcasts of favorite players or watch matches of professional teams at esports events.
What is the reason for Twitch's withdrawal? According to DJ Clancy, keeping Twitch running in South Korea is 10 times more expensive than in other regions, making the situation "unique" for the company. The fact is that legislation in South Korea allows ISPs to charge large foreign media companies higher network usage fees. This is due to the fact that the products of these companies take up a large part of the traffic and put a significant load on the servers. In the past, Netflix, an online movie theater, faced a similar issue in South Korea: it tried to challenge the sharing of network costs with SK Broadband, but after three years of litigation, the companies withdrew their mutual claims and decided that it was easier and more profitable for them to become partners.
Clancy noted that Twitch has tried various ways to reduce its costs in South Korea. For example, the service experimented with a peer-to-peer model and limited the quality of streaming to 720p. Nevertheless, it did not help to reduce costs to an acceptable level, and the company found no other way but to stop working in the country. Twitch management promised that it would help Korean streamers move to other platforms. However, how exactly this will be realized is not yet clear.
The situation with Twitch in South Korea cannot be called new, as telecom operators in different markets have long called for sharing network costs with major content providers. For example, this is being actively discussed in India, the world's second-largest wireless market.
How popular is Twitch in South Korea?
As of 2023, Korean is the sixth most popular language on Twitch in terms of watch time (Hours Watched). This number has been steadily increasing in recent years, albeit at a small rate. The share of Korean broadcasts on Twitch in 2020-2023 was around 5.5%, which is very high for a language that is not classified as an international one (like English or Spanish).
When it comes to channels, Korean is in the Top 10 on the platform by this metric — accounting for about 1% of all channels on the platform in 2020-2023. At the same time, in contrast to Hours Watched, the number of unique channels is gradually decreasing. In 2021, there were 210.8K of them, but in 2022, their number decreased to 191.7K. By the end of 2023, the figure will certainly be even lower.
It is convenient to track the dynamics of the Korean language on Twitch using the example of broadcasts of the Korean regional LCK League of Legends league. It is definitely the most popular esports league in the country and has the largest share of viewers from South Korea.
In 2021 and 2022, Twitch's share of LCK broadcasts was 66-67% of total Hours Watched. In fact, Twitch was the main streaming platform for the league, but that changed in 2023. In the league's last season, YouTube's share went from 11% to 37.3% of the HW total in one year. At the same time, Twitch's share more than halved to just 25.9%.
As we can see, Twitch is no longer the dominant platform even in the most popular Korean league for the most popular esports discipline in South Korea. More and more viewers watch broadcasts on YouTube, AfreecaTV, Naver Esports, and other streaming services. At the same time, the popularity of the league itself is only growing every year. In other words, Twitch's shutdown in South Korea is unlikely to significantly affect the league's stats (and most likely the whole esports scene of the country in general). LCK is too much in demand for the local audience, which will have no problems with broadcasts on other platforms.
What to expect for Korean Twitch streamers?
Twitch streamers from South Korea will have several options after February 27 to continue their careers. A lot depends on the popularity of the streamer and the type of content he or she broadcasts.
Most watched Twitch streamers from South Korea in 2023
The Korean Twitch segment of Twitch has historically been dominated by gaming broadcasts — streams of esports players, broadcasts of tournament matches, let's plays, etc. A similar type of content dominates on the Korean service AfreecaTV: there is a large number of broadcasts on League of Legends, StarCraft, Fortnite and Minecraft, and local streamers can compete with their Twitch colleagues in terms of audience reach.
After the announcement of Twitch's withdrawal from South Korea, the shares of AfreecaTV Co Ltd on the KOSDAQ stock exchange rose by about 25%. Apparently, the businessmen also believe that most of the streamers and viewers will move there.
Non-gaming content is very popular on YouTube, where many streamers and viewers from South Korea are also present. We can also mention Singapore's Bigo LIVE among local services: the audience there is not so large, but there are enough broadcasts in Korean. Kick also announced its readiness to accept Korean streamers.
Another option for Korean streamers may be to move to another country. This is a difficult decision, but it is quite possible for top creators who travel a lot and have most of their viewers abroad. In this case, staying on Twitch may be the most suitable choice.