Twitch to Cease Operations in South Korea Due to High Costs

Twitch, a popular live streaming platform, is reportedly shutting down its operations in South Korea due to high operational costs. This move highlights the challenges that even major digital companies can face in sustaining their business models in specific markets. The decision to cease operations in South Korea emphasizes the impact of financial considerations on the expansion and maintenance of international services by tech companies. For Twitch, known primarily for video game streaming, this could mean reassessing its global strategy to focus on more profitable or sustainable markets.

Twitch, Amazon’s streaming unit, has announced that it will shut down its operations in South Korea in February of the following year due to high operational costs and network fees. According to Twitch CEO Dan Clancy, the platform has been operating at a significant loss in South Korea, and there is no sustainable business path forward in the country. He highlighted that network fees in Korea are still about ten times more expensive than in most other countries. To stay afloat, the company had previously made significant efforts to reduce operating costs, including laying off over 400 employees in March after failing to meet user and revenue growth expectations​