Netflix, a global online video service (OTT), has filed a lawsuit against SK Broadband over the controversy over Internet network usage fees.
Netflix Services Korea, a Netflix corporation in Korea, has reportedly filed a lawsuit against SK Broadband with the Seoul Central District Court on April 13 to confirm the absence of debt.
The suit calls for Netflix to be free from the obligation to pay SK Broadband for the operation, expansion and use of the network in connection with network traffic.
Regarding the lawsuit, Netflix said, "ISP has a transmission obligation so that consumers can access the Internet service they want, and CP has its own role in producing content. It is dual and unfair for ISP, which charges consumers, to receive network fees from CP."
It added, "The arbitration of Korea Communications Commission has been carried out, but the gap between the two sides has not narrowed. However, the two companies will continue to cooperate for consumers separately from the lawsuit."
Earlier in November last year, Netflix and SK Broadband filed an adjudication application with Korea Communications Commission asking for arbitration on the network fee negotiations.
However, the two sides failed to narrow their differences and the conflict over network fees eventually led to a legal battle. Due to the lawsuit, the KCC's arbitration proceedings will be suspended.
SK Broadband said, "We need to come up with measures to jointly resolve Netflix's soaring traffic," adding, "We will review the complaint once it is delivered by the court and decide on follow-up measures."
Industry sources predict that the lawsuit will not end in a single game, but will lead to tedious battles such as appeals and the Supreme Court.
Meanwhile, Netflix is the world's No. 1 OTT with 167 million subscribers from 190 countries. In 2018, Netflix's paid users in Korea, which was around 400,000 people, have recently increased rapidly, exceeding 2 million. Some analysts say Netflix generates 15 percent of global traffic because it provides high-definition video services.
