Netflix ordered to change ‘unfair’ subscription terms in Korea

SEOUL, Jan. 16 (UPI) — South Korea’s Fair Trade Commission ordered Netflix to revise its subscription terms, which it said are “unfair.”

The FTC took issue Wednesday with six clauses, including one that enables Netflix to change billing and membership terms without its customers’ prior consent.

Netflix formerly sent notifications to its users when changing its terms, according to the antitrust watchdog. Under new regulations, the online streaming service must provide users the ability to cancel their subscription if they do not agree to term changes.

South Korea’s FTC also ordered Netflix to change its policy around hacking. Formerly, Netflix customers would be left with the cost burden of any account hacking incident, but users will soon only be held responsible for their own negligence.

In line with the FTC orders, Netflix has decided to come up with new terms, which will take effect Monday.

The FTC is the first in the world to instruct Netflix, the multinational giant that accounts for more than 30 percent of the global video streaming market, to amend its terms of use.

“We expect that many domestic and overseas players will tap into the over-the-top media service market of South Korea,” Lee Tae-hwi, who leads FTC’s terms review department, said during a news conference.

“From the early stage of their business, we will check whether there are unfair terms so that they have to revise them.”

Netflix, which was founded in 1997, gained massive popularity in South Korea after entering its market in early 2016. The number of its paid viewers in the country surpassed 2 million last November.