Google's Unpaid Network Fees: A Case of 'Free-Riding' in Korea? - The Korea Herald
Google may have dodged paying a substantial sum of up to 347.9 billion won ($244 million) in network usage fees in 2024, according to a Korean lawmaker's claims, sparking renewed debate about global tech firms' alleged 'free-riding' on the nation's internet infrastructure.
The controversy centers on Rep. Choi Soo-jin from the main opposition People Power Party, who serves on the National Assembly's Science, ICT, Broadcasting and Communications Committee. Her independent analysis suggests that Google's unpaid fees could range from 214.7 billion won to 347.9 billion won, based on a comparison with local platform operators Naver and Kakao's historical network fee ratios.
The lower-bound figure is calculated using Naver and Kakao's payment ratios (1.8% and 2%, respectively) from 2016 and applied to Google Korea's projected 2024 revenue of 11.3 trillion won. The higher-end estimate, 347.9 billion won, assumes Google's 31.2% share of South Korea's internet traffic, which, according to the Korea Information Society Development Institute, equates to a significant portion of the dedicated internet line market's total value in 2024.
Rep. Choi emphasizes the importance of market fairness, stating, 'Paying for network usage is a fundamental principle.' She argues that Google's market dominance allows it to exploit its position, receiving annual 'free benefits' worth hundreds of billions of won, a clear case of market failure.
The lawmaker calls for swift passage of the 'network free-rider prevention act,' legislation aimed at ensuring fair contributions from large foreign content providers. She also urges the government to mediate network usage negotiations between global tech firms and domestic telecom operators, addressing structural reverse discrimination against Korean ICT companies and restoring a competitive balance.
Google and other foreign platform operators have historically opposed mandatory network fees in Korea, claiming 'double billing' since end users already pay internet service providers. They also invoke net neutrality principles, advocating for equal treatment of internet traffic regardless of content, platform, or application.
The debate surrounding Google's unpaid fees highlights the complex relationship between global tech giants and local markets, raising questions about the responsibilities of tech companies in contributing to the infrastructure they rely on.
