The South Korean government is considering applying antitrust regulations following abrupt price hikes by major content platforms such as YouTube and Netflix.
A senior ruling party official stated in a media interview on Dec. 21, “A 40% hike in consumer prices at once is a kind of monopolistic abuse.” The official emphasized the need for consumer protection and the creation of guidelines based on the findings of an investigation by the Ministry of Science and ICT, the responsible department.
Previously, President Yoon Suk-yeol criticized the monopolistic structure at a cabinet meeting on Dec. 19. He highlighted the plight of small business owners who are left with little after paying fees and commissions to platforms. Yoon warned that a solidified monopoly would deprive them and consumers of the freedom of choice and the ability to switch services.
Following these criticisms, the government and ruling party are focusing on the monopolistic position of businesses like YouTube as a primary factor in the price increase. They are working on measures to address this monopoly.
The Fair Trade Commission announced its intention to pre-designate key platform operators with monopolistic power after President Yoon’s remarks. They also plan to introduce the “Platform Fair Competition Promotion Act” to prevent abuse of market-dominant positions.
YouTube recently announced a 42.6% increase in its YouTube Premium membership, from 10,450 won to 14,900 won. This membership offers ad-free video viewing. Without this membership, users have to watch lengthy ads along with each video.
Consumers have strongly opposed this price hike, the first since September 2020. Particularly, existing subscribers who had maintained the initial prices since the last hike voiced strong protests. With the new rates, they would face a 71.5% increase in fees.
Netflix has also effectively raised its usage fees by discontinuing its Basic Plan for new subscribers and ending the free account-sharing policy.
While global platforms claim the necessity of price hikes due to high network usage fees in Korea, the government remains unconvinced. It asserts the need to scrutinize the situation of platform companies that generate significant revenue in Korea yet remain outside regulatory boundaries, regardless of network fees.