SK Broadband and Netflix Enter Strategic Partnership

SK Broadband, a major Korean internet service provider, and Netflix have resolved their long-standing legal dispute and announced a strategic partnership. The conflict primarily revolved around network usage fees, with SK Broadband accusing Netflix of not paying for the strain its streaming service put on the network.

According to SK Broadband, Netflix’s traffic surged from 50 Gbps in May 2018 to 1,200 Gbps in September 2021 due to the popularity of shows like “Squid Game” and Korean-language dramas. The company claimed that Netflix was a freeloader, refusing to pay for the network’s usage.

Netflix, on the other hand, argued that demanding internet access fees from them would be a double charge, as users already pay fees for the service. A local court ruled in favor of SK Broadband in June 2021, stating that it was reasonable for Netflix to offer something in return for using the network. However, Netflix contested the ruling, putting the lawsuit on hold.

In a previous trial, Netflix’s legal representatives argued that the companies had agreed on interconnecting separate internet networks without any payment, known as “peering.” SK Broadband countered this claim, stating that conditions had changed since May 2018, and the peering arrangement had shifted to SK Broadband’s privately leased line.

Following the resolution of the legal dispute, SK Broadband, its subsidiary SK Telecom, and Netflix have entered into a strategic partnership to enhance customer service. They will develop new services that will allow customers to access Netflix on their pay TV platform or smartphones, starting in the first half of next year.

The settlement between SK Broadband and Netflix marks a significant milestone as both parties put their differences aside and commit to collaboration for the future.