Twitch leaving Korea due to "prohibitively expensive" operating costs

gamedeveloper.com:

Twitch is shutting down its business in Korea and claims that operating in the region has become "prohibitively expensive."

In a blog post announcing the move, Twitch CEO Dan Clancy said the streaming company will cease operations in Korea on February 27, 2024, and suggested that operating in the region is no longer sustainable.

"Ultimately, the cost to operate Twitch in Korea is prohibitively expensive and we have spent significant effort working to reduce these costs so that we could find a way for the Twitch business to remain in Korea," he said.

"First, we experimented with a peer-to-peer model for source quality. Then, we adjusted source quality to a maximum of 720p. While we have lowered costs from these efforts, our network fees in Korea are still 10 times more expensive than in most other countries. Twitch has been operating in Korea at a significant loss, and unfortunately there is no pathway forward for our business to run more sustainably in that country."

Clancy described the situation in Korea as "unique" in a bid to quell concerns that it could pull the plug in other regions. "Operating costs in Korea are significantly higher than they are in other countries and we have been open about this challenge for some time," he added.

Clancy noted the company intends to help Twitch streamers in Korea find new homes beyond its own platform. To that end, Twitch has been reaching out to several alternative livestreaming services that operate in the country to enable its community to transition following the shutdown. 

"I want to reiterate that this was a very difficult decision and one we are very disappointed we had to make," concluded Clancy. "Korea has always and will continue to play a special role in the international