Calls Growing for Tougher Regulations on YouTube and Netflix

YouTube’s and Netflix’s growing market shares and influence in Korea are fueling moves to make these global video platforms subject to broadcasting regulations in Korea.

In particular, there is a growing concern over YouTube recording an overwhelming share in the internet and mobile video market in South Korea. According to a report on shares of mobile video app use released by WiseApp in May, YouTube dominated the Korean video market with an overwhelming share of 85.6%. With YouTube enjoying a sharp increase in its users on the internet and mobile world, Google are hogging high-quality content and advertising revenue.

The biggest Korean internet portal Naver which has led the Korean platform market is also keeping a watchful eye on the fast rise of YouTube. While a large number of internet and mobile users have adopted YouTube as their base platform, its influence has been growing day by day but YouTube is not properly regulated.

At the moment, according to many experts, it is proper to integrate the Internet Protocol Television (IPTV) Business Act into the Broadcasting Act and define over the top (OTT) operators as value added carriers and make them subject to the Broadcasting Act.

"New services such as Netflix, OTT, and one-person broadcasting are left in blind spots of regulations while excessive regulations are impeding the innovation of existing broadcasters." said Park Sang-ho, director of the Public Media Research Institute in a public hearing held at the National Assembly on August 24.

Fast-growing OTT broadcasting and personal internet broadcasting are now classified into supplementary communication services under the Telecommunications Business Act. Therefore, these operators are free from the Telecommunications Business Act, not the current Broadcasting Act, and are hardly regulated in terms of market entries, advertising, and contents. Network and cable TV companies as well as Korean internet portals are subject to strict regulations while YouTube and Netflix are enjoying more benefits, so many experts are pointing out that some actions have to be taken to correct the situation.

However, some experts refute that the same rule cannot be applied to value added carriers out of concern that if regulations applied to key telecommunications service providers expand to cover value added carriers, it may hamper the growth of the internet industry.

Therefore, there will be many pros and cons on whether or not to include OTT operators in the broadcasting law in addition to a reverse discrimination between Korean and foreign operators in the process of discussing an integrated broadcasting law in the future.