YouTube Music Faces South Korean Regulatory Action Over Bundling Concerns

YouTube Music south korean regulatory
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YouTube Music south korean regulatory
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Photo Credit: YouTube Music

Google faces potential South Korean regulatory action over its bundling practices of YouTube Music into its YouTube Premium tier, in an investigation focused on whether the company unfairly hindered competition in the region.

The Korean Fair Trade Commission (FTC) has revealed it has been conducting an ongoing investigation into Google for over a year, with deliberations to determine sanctions set to begin soon. The investigation centers on whether Google’s practice of bundling YouTube Music into its YouTube Premium subscription tier unfairly hindered the business of other music streaming competitors, restricting competition.

The number of YouTube Music users has increased dramatically since the bundle with YouTube Premium began, reaching around 7 million people in South Korea and surpassing domestic streaming companies such as Melon to become the top streaming service in the country.

Korean broadcast outlet KBS reports there have been concerns that the prolonged investigation may render any decided upon sanctions ineffective, since any damage to the market is already well done.

“We need faster action and conclusions,” comments an industry insider who wished to remain anonymous. “It’s causing significant damage to domestic operators.”

Still, KBS asserts there have been growing concerns on a global scale about the nature of platforms that bundle their services and, rapidly monopolizing a market and damaging its related industries.

Similarly, Apple has been under investigation in the US for five years due to its “closed ecosystem” for iPhone users, with an antitrust lawsuit filed against the company by the US Department of Justice. On the other hand, the European Union has proactively identified platforms to regulate and urged them to make the required adjustments.

Though not illegal, Spotify’s recent decision to bundle its services into a music-only and audiobook-only tier has earned it the ire of the music publishing industry, who caution that songwriters will earn less in mechanical licensing. David Israelite, CEO of the National Music Publishers Association (NMPA), asserts that this is a deliberate move by Spotify to skirt around paying its dues.