To Level Uneven Playing Field
Lawmakers will deliberate bills regarding the controversial free-riding of Korean telecom networks by global IT giants such as Google, Netflix, and Facebook.
The legislative subcommittee of the National Assembly’s Science, ICT, Broadcasting and Communications Committee will convene on May 6 to discuss bills related to the regulation of global content providers (CPs). It will be the subcommittee’s last session during the 20th National Assembly, whose term ends on May 29.
The committee is planning to quickly review the bills to address the problem of reverse discrimination against Korean companies which are competing with global CPs such as Google and Netflix.
Korean lawmakers previously proposed amendments to the Telecommunications Business Act and the Act on Promotion of Information and Communications Network Utilization and Information Protection to address the problem of free-riding of foreign IT companies.
In particular, a bill proposed by lawmaker Yoo Min-bong is aimed at remedying the situation where foreign CPs cause traffic explosions and make enormous profits without sharing the network expansion and upgrade costs.
Yoo expressed concerns that if the global CPs use Korean communication networks without paying fees for using them, Korean CPs will not be able to compete fairly with them.
"Foreign CPs’ domestic influence is increasing, but they are not subject to regulations related to the quality of services," Rep. Kim Kyung-jin said. “Overseas CPs have little contribution to the Korean market in tax and employment. They abuse their power based on their market control. Korean companies are suffering from reverse discriminations.”
"Some industry experts note that the telecom network fees imposed on foreign value added service providers are significantly smaller than those on their Korean counterparts," Rep. Roh Woong-rae pointed out
To address this problem, members of the Science, ICT, Broadcasting and Communications Committee have decided to ban the imposition or forcing of unreasonable or discriminatory conditions or restrictions on the use or provision of communication networks and the unfair rejection of contract signing or non-compliance with signed contracts.
A tug-of-war over network fees between foreign CPs and Korean telecommunications companies has escalated into a legal dispute. Netflix has filed a lawsuit against SK Broadband as the Korea Communications Commission recently began to review an application for a ruling filed by SK Broadband regarding its dispute with Netflix.
Industry insiders say that Netflix has ignored the Korean governments’ administrative procedures by bypassing the KCC.
In particular, while foreign CPs such as Netflix are free-riding Korean internet networks, Korean CPs such as Naver and Kakao pay tens of billions of won in network use fees. Recently, since the beginning of the new coronavirus crisis, Netflix's paid subscribers and viewing time have skyrocketed, sparking off not only traffic explosion problems but content monopoly issues.