Twitch is in hot water in South Korea. The Korean government has slapped Twitch with a hefty fine of 420 million won (about $315,000) for breaking local telecom law. This penalty stems from Twitch’s decision to disable Video on Demand (VOD) access for South Korean users. The country’s Telecommunications Commission (KCC) deemed this move a violation of its regulations.

Twitch’s costly decision

Ironically, Twitch’s decision to leave the South Korean market in an effort to save money backfired. Twitch left South Korea last year because of excessive operating costs, mostly from bandwidth costs. But the company now faces fines totaling hundreds of thousands of dollars as a result of this decision.

The KCC insists that Twitch’s actions have disadvantaged users and undermined local interests. Twitch’s refusal to provide sufficient justification for limiting streaming quality further fueled the legal dispute. The company cited confidentiality obligations, but this didn’t satisfy the KCC’s demands.

Twitch’s financial issue

This fine complicates Twitch’s financial difficulties, which have lately come under investigation. Twitch’s CEO, Dan Clancy, acknowledged the platform’s lack of profitability and its reliance on parent company Amazon. Twitch is under a lot of financial strain because of impending fines and possible refunds.

The future of Twitch

Future plans for Twitch are called into question as it struggles to overcome these obstacles. Concerns regarding the company’s international operations have been raised in addition to legal issues arising from its decision to leave South Korea. With lingering problems and hazy profitability, Twitch’s future is still unclear.