Kakao, Naver Face Threat as Global Tech Giants Challenge Domination in S. Korea | Be Korea-savvy

Kakao, Naver Face Threat as Global Tech Giants Challenge Domination in S. Korea


This photo provided by Kakao Corp. shows its Pangyo office in Seongnam, Gyeonggi Province.

This photo provided by Kakao Corp. shows its Pangyo office in Seongnam, Gyeonggi Province.

SEOUL, June 6 (Korea Bizwire)KakaoTalk and Naver, two popular platforms in South Korea known as the “people’s messenger” and “people’s portal,” respectively, are facing a growing challenge from global tech giants.

KakaoTalk’s position as the top platform for monthly active users (MAU) is being threatened by Google’s YouTube, with a narrow gap of 507,487 users, according to recent data from Mobile Index, the big data analysis unit of local data tracker IGAworks.

This decline has been ongoing for six months, raising the possibility of YouTube surpassing KakaoTalk’s MAU in the second half of the year.

YouTube’s influence extends beyond MAU, as it has already surpassed KakaoTalk in total time spent and active devices. It also poses a threat to Kakao Corp.’s music streaming service Melon.

This shift in consumer behavior, favoring visual platforms like YouTube and Instagram, particularly among Generation Z, has contributed to the decline of domestic platforms.

Naver, as a web-based search engine, faces a declining market share due to Google’s expansion. Naver’s share of the search market fell to 55.7 percent in May, while Google’s share rose to 34.8 percent.

These trends have raised concerns within Naver Corp. about the need to adapt to changing market dynamics.

This undated photo provided by Naver Corp. shows the company's headquarters.

This undated photo provided by Naver Corp. shows the company’s headquarters.

Both Kakao and Naver are confronted with heavy regulation and potential discrimination compared to overseas platforms.

However, some argue that overly restrictive regulations can weaken their competitiveness in the face of global competition. It is crucial for these platforms to receive policy support to protect their technological sovereignty.

To combat these challenges, Naver plans to enhance its search screen and app with personalized experiences using artificial intelligence (AI) technology.

Kakao has already implemented changes, such as separating open chats into a separate tab on KakaoTalk. Both platforms aim to improve their services to retain users and remain competitive.

Kevin Lee (kevinlee@koreabizwire.com)

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