SK Broadband and Netflix, which have been locked in a long dispute over network usage fees, drop their lawsuits and join forces.

Global entertainment streaming service Netflix, SK Telecom, and SK Broadband announced on the 18th that they have signed a strategic partnership to enhance customer benefits at the Netflix Korea office in Jongno-gu, Seoul.
Starting in 2020 when Netflix, as a global content provider, filed a lawsuit against SK Broadband regarding network usage fees, the two companies have been engaged in a long battle for about three and a half years. In 2021, the Seoul Central District Court ruled in favor of SK Broadband, but Netflix appealed.

The main point is that SKB claims its investment and operating costs have increased due to the rise in traffic caused by Netflix using SKB's network, and therefore demanded that Netflix pay network usage fees.

However, Netflix did not accept SKB's claims. Netflix argued that SKB's network is a public good and that network usage fees should be charged to all internet service providers.

Since then, the two companies have been locked in seemingly endless friction over network usage fees, and it appears they ultimately failed to reach a conclusion prior to this partnership and are withdrawing the lawsuit.

In particular, according to industry sources, unlike its competitors KT and LG Uplus, SK Broadband was the only one unable to offer Netflix on its IPTV. It is predicted that this has affected operating profit, including long-term litigation costs.

Both parties announced that, taking this partnership as an opportunity, they have agreed to put an end to all previous disputes and work together as future-oriented partners.

Through this partnership, SKT and SKB will sequentially provide various products, including Netflix bundle plans, to customers on smartphones and IPTV (B tv) starting from the first half of 2024. In addition, a Netflix bundle product is being introduced for SKT's subscription service, T Uju.

In addition, SKT and SKB are also pursuing technological cooperation and are exploring ways with Netflix to create consumer-friendly entertainment experiences using AI technology, such as conversational UX and personalized guides.

Tony Zameczkowki, VP of Business Development for Netflix Asia Pacific, stated, "The partnership with SK Telecom and SK Broadband, leaders in Korea's wired and wireless telecommunications and future-oriented technology industries, holds special significance in that it allows us to provide a convenient viewing environment to even more Korean members. As providing the best entertainment experience throughout the journey from the creation of a special story to its arrival on the screens of members worldwide is Netflix's top priority, we look forward to the journey we will walk together for our shared customers."

Choi Hwan-seok, Head of Business Strategy at SKT, stated, "This strategic partnership with Netflix stems from the philosophy of SK Telecom and SK Broadband, which prioritizes customer value, and is the result of a broad agreement to provide customers with a better media service environment by incorporating the technology accumulated by SK Telecom." He added, "We will continue to evolve and develop into an AI Company and strive for mutual cooperation with various domestic and international players."