Line and Yahoo Japan Merge Launch..."5 Trillion Won Investment Over 5 Years" (Comprehensive)

[Asia Economy Reporter Buaeri] Naver's Japanese subsidiary Line and Yahoo Japan completed their business integration on the 1st.

The integrated Z Holdings Group has set a goal to achieve sales of 2 trillion yen (21.2 trillion KRW) and operating profit of 225 billion yen (2.4 trillion KRW) in 2023. Having faced setbacks in two previous attempts to enter the Japanese market, Naver aims to reinvent itself as a global platform by joining hands with 'Yahoo Japan.' The group will operate various businesses including portal, commerce, and artificial intelligence (AI).

Z Holdings Group plans to invest 500 billion yen (5.3 trillion KRW) over the next five years to drive growth in each business centered around AI. It also plans to increase the number of AI engineers by about 5,000 globally and in Japan over the next five years.

Z Holdings Group will continue to promote the core business areas of Yahoo Japan and Line, which are 'search/portal, advertising, and messenger.' In addition, it defines four new business areas?'commerce, local/vertical (regional/specialized services), fintech, and public'?and aims to create synergy by integrating data and AI technologies.

Z Holdings Group will develop its shopping business through social commerce based on Japan's national messenger app 'Line.'

It will launch services such as 'Line Gift,' which allows users to send gifts to friends; 'Group Buying,' where multiple friends can purchase items at discounted prices; and 'Live Commerce,' where users can watch product introduction videos and purchase products.

In the first half of the year, it will introduce the 'Smart Store' solution, leveraging Naver's expertise, to Japan. This solution will provide operators with tools for site creation, management, and analysis, and in the mid-to-long term, it plans to offer tools that enable companies to operate both online and offline stores on a single screen.

For the local and vertical business, AI will be extensively utilized for reservations and customer acquisition across various services such as 'Yahoo Maps,' 'Ikkyu.com Restaurant,' and 'Line Place.' It will also consider leveraging the largest delivery infrastructure in Japan owned by the food delivery service 'Demaekan' to enhance delivery convenience.

Z Holdings Group will expand its fintech influence. It plans to enhance the 'scenario finance' approach, which proposes optimal financial products such as loans, investment products, and insurance tailored to user behaviors like 'purchase, reservation, and payment.' Negotiations are also underway to integrate Line Pay's QR and barcode payments with PayPay in April next year.

In the public sector, digital transformation will be realized through public-private cooperation focusing on administrative digital transformation, disaster preparedness, and healthcare.

Regarding healthcare, the group has set an ambition to make 'Line Doctor' the number one service in Japan by launching online medical consultations along with online medication guidance services.

Meanwhile, Z Holdings serves as an intermediate holding company that wholly owns Line and Yahoo Japan. On the same day, Naver and SoftBank also launched holding company A Holdings, which owns 65% of Z Holdings' shares. Both companies hold 50% of A Holdings' shares each. The co-CEOs of A Holdings are Lee Hae-jin, Naver's Global Investment Officer (GIO), and Ken Miyauchi, SoftBank's Chief Executive Officer (CEO).