Facebook’s net neutrality battle

Facebook’s Korea operation is embroiled in a controversy over net neutrality and faces accusations that the social media company is not paying its fair share to local telecom providers to maintain the quality and speed of its services.

The Korea Communications Commission, the government agency which regulates telecommunications, said Monday that it would investigate whether Facebook Korea violated the country’s Telecommunications Business Act by deliberately changing the network router of one Korean internet service provider to Hong Kong and limiting the connection speed of its subscribers.

Facebook Korea issued a statement on Tuesday saying it would “sincerely comply” with the investigation.

The internet service provider in question is SK Broadband. The issue surfaced in December when SK Broadband subscribers noticed a slower connection to Facebook and Instagram, the photo-sharing app owned by Facebook. The social media company had diverted all SK Broadband traffic to a server in Hong Kong instead of a local server in Korea. The further away the server is, the slower the connection.

Before, Facebook Korea was only paying KT for the cost of running a local cache server, though the country’s three telecommunications providers share the burden of running it. A cache server is used to save internet content locally in temporary storage, called a cache, so that the speed of access to data is improved and demand on an enterprise’s bandwidth is reduced.

Some subscribers to the other two service providers - SK Broadband and LG U+ - were automatically diverted to KT’s cache server for faster connection. But as traffic for Facebook spiked, largely owing to the growing amount of video and live-streaming broadcast content, SK Broadband also demanded payment from Facebook, arguing that other content providers using heavy traffic, such as Naver and Kakao, pay fees proportionate to the amount of data their users consume. Although no specific details are made public, both Korean companies are known to pay billions of won to wireless operators for using the network.

Facebook is the most frequently used social media app in Korea. According to research firm WiseApp, Koreans using Android smartphones spent 5.6 billion minutes on Facebook in April. Naver’s Band came next with 2 billion minutes. Instagram took fourth with 1 billion minutes.

“Facebook is making enormous money in Korea but is not willing to pay the cost of maintaining the quality of service,” an SK Broadband spokesman said. “It is natural that both parties seek measures to share the cost burden together.”

The spokesman added that the staff member in charge of the issue at Facebook is rarely available to talk.

Facebook Korea contends that it is a content provider and therefore not liable to pay for the cost. It may assist SK Broadband’s installation of cache servers solely dedicated to Facebook users if necessary.

“We may bear the responsibility for necessary devices and installation, given the measure would improve Facebook’s user environment in a meaningful manner,” Facebook said in a statement Tuesday. But it insisted that SK Broadband had demanded Facebook pay the entire cost for it.

The companies are now pointing fingers at each other. Some media reports are saying it was Facebook that initially demanded SK Broadband install a server for it.

Han Seong-sook, CEO of Naver, on Wednesday urged the government to come up with a uniform stance on the network cost issue, saying there is lingering discrimination between Korean and foreign companies.

According to the Ministry of Science, ICT and Future Planning, there is no act that dictates whether a content provider should pay for network traffic. The matter depends on discussion between content providers and network operators.

Internet service providers are increasingly challenging the concept of net neutrality, which states that service providers should treat all data on the internet the same, irrespective of user, content, platform or application. Ajit Pai, chairman of the U.S. Federal Communications Commission who was appointed by President Donald Trump in January, has expressed opposition in the past to open internet rules and appears determined to undo the commission’s net neutrality rules. The FCC last Thursday took the first step toward dismantling these regulations by approving a proposal to scrap the rules and is accepting public comment.

BY SEO JI-EUN [seo.jieun@joongang.co.kr]