[Newsmaker] Netflix hikes subscription fees by 17 percent in Korea

Streaming giant Netflix announced on Thursday a subscription fee increase of up to 17 percent, its first hike since launching the service in South Korea in 2016.

The streaming platform’s standard plan will cost 13,500 won ($11.45) a month, up 12.5 percent from the previous 12,000 won, and the premium plan will go up 17.24 percent to 17,000 won from 14,500 won. The basic plan will remain unchanged at 9,500 won.

Local users will be notified of the price changes 30 days before their renewal dates, while the increased fees will immediately apply to new subscribers.

The double-digit increase comes as Netflix is under increasing pressure to pay for network usage in Korea.

Several lawmakers at the National Assembly are also pushing for a revision to the Telecommunications Business Act that would legally obligate major content providers to shoulder the cost of network maintenance. They say Netflix and other massive content platforms are free-riding on the network it provides, which requires maintenance costs.

Netflix, however, says the changes in its subscription prices are not related to the need to pay bandwidth usage fees.

Earlier this month, Netflix Vice President of Public Policy Dean Garfield hinted at the need for fee increases during a press conference in Seoul.

Garfield, however, maintained the company’s previous position on the issue of paying bandwidth usage fees to internet service providers, arguing that the company does not have a duty to pay.

The company is in a court dispute with SK Broadband, a major internet access provider here, over network usage fees.

By Shim Woo-hyun (ws@heraldcorp.com)