[The Next Crisis]③ "Portal Industry Without Diversity, Only Foreign Platforms Benefit"

If Absent, Naver Alone Exposed to Political External Influence
Only Google and Bing Foreign Platforms Strengthen Their Influence

If Daum, once a national portal, disappears, the impact on the domestic portal industry will be significant. Although its market share is small, the duopoly of Naver and Daum will collapse. Under Naver's solo dominance, the diversity of portal services will disappear, making them vulnerable to political external pressures. There are concerns that if the domestic portal industry loses competitiveness, the influence of foreign platforms will only grow.

Kakao Unaffected by Daum's Disappearance... Rather a Positive

Inside and outside the industry, it is believed that even if Kakao sells Daum, there will be little impact on its existing business. This is because, aside from integrating Daum accounts into Kakao, there are not many linked services. Some even predict a positive effect. Although the overall revenue scale may shrink, by trimming low-profit businesses, operating profit margins can be improved. The proceeds from the sale could be invested in high-growth areas. Kakao's investments in new businesses such as artificial intelligence (AI) and healthcare are currently hindering its performance recovery. Securing cash through the sale of Daum could provide much-needed breathing room.

On the other hand, some analyze that selling Daum may not be easy. This is because Daum has a brand value as a native portal that has maintained its position for over 20 years. Abandoning a platform that attracts about 10 million users monthly means giving up accumulated data and content. Considering that data is the core of AI, which Kakao is nurturing as its next growth engine, this is a regrettable aspect.

Won Yong-jin, a professor at Sogang University's Department of Communication, explained, "Portals play a significant role in AI learning," adding, "Looking at how SK (SK Communications) still operates Nate, the importance of portals in attracting people is evident."

Portal Industry Losing Competition... "Will Lose Diversity and Be Consumed by Google"

Even if Daum disappears, the impact on users will not be significant. The search market leadership was lost to Naver and Google long ago. Users seeking videos go to YouTube first. Users share their daily lives on social networking services (SNS), not portal services.

However, significant changes are expected in the portal ecosystem. The competitiveness of the domestic platform industry is forecasted to weaken. Although Daum's market share is low, it stimulated competition among portal services and helped grow the platform industry. Globally, only the United States, China, and South Korea have their own national portal services. Except for China, which blocks foreign services, only Korea's portals have survived competition with Google. The void left by Daum is likely to be filled by foreign platforms, including Google.

From Naver's perspective, it will have to withstand political external pressures alone. Issues such as "portal monopoly" and "news bias" are repeated every year during national audits. Until now, Naver voiced concerns together with Daum, but if only Naver remains, it will inevitably become vulnerable to external pressure. This could further weaken the diversity within portals.

In this situation, it is pointed out that Daum must focus on specialized services to survive. This means selecting and concentrating on competitive community functions, such as revamping services centered on Daum Cafe. Yahoo, which once fell from being the number one portal in the US, Europe, and various Asian countries, had a similar case. Yoo Byung-jun, a professor at Seoul National University's Business School, said, "Yahoo survived in the US by specializing in Yahoo Finance, an economic portal," adding, "Realistically, Daum should adopt a survival strategy by focusing on specific sectors or functions."