Netflix's CEO to come to Seoul to possibly settle dispute with SK and authorities

Netflix CEO Reed Hastings. [Photo by Lee Chung-woo]

Reed Hastings, co-founder and chief executive of global streaming giant Netflix Inc., will fly into South Korea to meet SK Telecom Co. Vice Chairman Park Jung-ho, raising expectations for an out-of-court settlement over their dispute over free-riding on Korean networks.

According to multiple sources from the telecommunications industry on Sunday, Hastings is said to be discussing his itinerary in Korea for later this month that includes a meeting with senior officials of SK Telecom. A meeting to include Park spearheading SK Group’s future growth could suggest room for wider cooperation between the two companies.

What the two will discuss is unknown, but a meeting could be a tipping point for partnership Netflix and SK Group’s over-the-top service Wavve, said an unnamed official from the business circle.

The meeting however could be moderated from government quarantine measures to contain spread of Omicron variant from overseas.

Hastings’ visit which would be the first since 2019 will likely first address the legal dispute with SK Broadband, which has filed a lawsuit against Netflix over network usage costs from increased traffic.

Park earlier this year has suggested a tete-a-tete with Hastings, stressing that there was a room for partnership between the two companies.

Netflix has turned more eager on Korean operation after the smash-hit Korean series “Squid Game” and “Hellbound” on its platform, said an unnamed official from the OTT industry.

In June, the court in first trial ruled that Netflix should pay for network connection, to which Netflix appealed. SK Broadband brought a counteraction to claim unfair profits.

In October, Korean President Moon Jae-in interfered in the issue, arguing global platform providers should fulfill their responsibilities. The Korea Communications Commission has been examining Netflix’s network usage fee matter.

Last month, Dean Garfield vice president at Netflix visited Korea and met with members of local communications regulator and related lawmakers. Another visit by a senior Netflix executive would suggest the urgency to settle disputes in Korea.

Netflix could a face a string of similar challenges from European internet service providers if it loses the case with SK Broadband in Korean court.

SKT Vice Chairman Park Jung-ho

Last month, chief executives of 13 telecommunications firms from each country in Europe announced a joint statement targeting Netflix, noting that U.S. tech giants should be partially responsible for communications network development costs in Europe.

From SK Telecom’s perspective, a new opportunity for partnership from the upcoming CEO meeting would create synergy with Netflix in diverse new business sectors. SK Telecom, which spun off its non-telecom business SK Square for investment in new business sectors could also eye ties in non-fungible token issuance business on original works.

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