Netflix "Would Not Have Chosen If SKB Fee Was Desired"
SKB "Only Decided to Prioritize Service Improvement"
[Asia Economy Reporter Cha Min-young] In the third hearing of the legal battle between SK Broadband and Netflix over the 'network usage fee' issue, which has entered its second round, the key point of contention was whether there was an 'unsettled settlement agreement.' However, without a concrete contract, both the plaintiff and defendant relied only on circumstantial evidence, causing the trial to stall.
On the 15th, the Seoul High Court held the third hearing between SK Broadband and Netflix. The main issue was whether SK Broadband and Netflix had implicitly agreed to an unsettled settlement regarding network usage fees. Netflix argued, "SK Broadband reduces costs through unpaid peering with overseas content providers (CP) and content delivery network providers (CDN) abroad," adding, "If SK Broadband had intended to receive network usage fees mandatorily, it would not have chosen the unpaid method at the initial connection in 2018."
SK Broadband countered, "In 2018, as traffic surged, both companies decided to prioritize service improvement while leaving the difficult issue of network usage fees as a matter for further negotiation."
Regarding the responsibility to prove the existence of an implicit agreement in the absence of a contract, Netflix claimed, "The party entitled to receive payment should present reasonable grounds," whereas SK Broadband argued, "Since the issue is whether the service was free, the user, Netflix, should provide proof," showing a difference in opinion between the two sides.
Whether unpaid peering agreements between CPs and internet service providers (ISPs) worldwide are common also became a point of debate. Netflix re-cited the Packet Clearing House (PCH) market research data referenced in the second hearing, stating, "Among 15 million peering targets in 192 countries, 99.9996% engage in unpaid peering."
SK Broadband raised concerns about the reliability of the statistics, saying, "Transit agreements were excluded from the survey, and cases of traffic exchange under network usage contracts between CPs and ISPs were also omitted," pointing out issues in the selection process of the sample population.
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