Image: Twitch
Twitch is officially shutting down in South Korea on February 27, 2024 due to high operating costs.
Twitch CEO Dan Clancy has announced that the streaming company is shutting down business in South Korea starting on February 27, 2024. The company head said that this was due to, “prohibitively expensive,” network costs to operate in South Korea, which he claims is, “10 times more expensive than in most other countries.”
Clancy shared the news with South Korea’s live streaming community this morning, confirming that there was, “no pathway forward,” for Twitch to operate in one of the biggest esports markets in the world.
Twitch shuts down in South Korea
Twitch is pulling out of South Korea on February 27, 2024, according to a blog post from Twitch CEO Dan Clancy published earlier today. In the post, Clancy explained that the “difficult decision,” to shut down operations in Korea came down to the costs of doing so in the region. The company didn’t come to the decision lightly, either - according to Clancy, several options were explored to reduce these costs before it saw the writing on the wall.
According to Clancy, Twitch first tried out a peer-to-peer model for source quality to bring down streaming costs, before attempting to cap source quality at a maximum of 720p. While that did lower costs some, Twitch’s network fees in Korea still ended up being 10 times more expensive than most other countries, causing the company to operate at a significant loss.
Clancy concluded that “there is no pathway forward for our business to run more sustainably in that country.” However, that doesn’t mean Twitch is going to start shutting down in other parts of the world. The Twitch CEO affirmed that the high operating costs of South Korea make this a, “unique situation." He also acknowledged Twitch streamers in Korea, who are now left without a platform to house the communities they’ve invested time into building.
Twitch plans to help these streamers move their communities to, “alternative livestreaming services,” such as AfreecaTV and YouTube in Korea, confirming that it has already begun to reach out to these services to get the transition started. What this means for large Korea-centered esports events such as the next LCK remains to be seen, but one can assume that most of them will shift to YouTube as their main streaming platform.