The Only Korean Director's Ouster Also Overlooked... Naver's Full Effort to Retain Line Shares

'Father of LINE' Shin Jun-ho CPO Resigns from Director Position at LINE Yahoo in Yongin

There is speculation that Shin Jung-ho, CEO and Chief Product Officer (CPO) of Line Yahoo, known as "Lee Hae-jin's right-hand man" and "the father of Line," stepping down from his position as a director of Line Yahoo is an attempt by Naver to avoid selling its shares. The move is interpreted as an effort to reduce Naver's influence and quell the "anti-Naver" sentiment. Although Shin CPO's departure was decided by the Line Yahoo board, it is believed that Naver tacitly approved it. Naver was actively involved, convening executive meetings around the time of the Line Yahoo board meeting.

On the 8th, Line Yahoo held a board meeting and resolved the resignation of Shin CPO and Takaya Taku, Chief Strategy Officer (CSO), from their internal director positions. While the CPO and CSO roles remain, they have stepped back from management. This appears to be a move to hold them accountable for an information leak incident.

Shin Jun-ho, Chief Product Officer (CPO) of Line Yahoo [Photo by Naver]

This personnel change will reduce Naver's influence. Until now, Line Yahoo's management was exercised by three individuals: Shin CPO, Kawabe Kentaro, Chairman and CEO, and Idezawa Takeshi, President and CEO. However, with Shin CPO stepping down from the board, two Japanese executives affiliated with SoftBank will gain full control.

In response to this decision, Naver issued a brief official statement saying, "Shin CPO's resignation from the board is Line Yahoo's decision." However, since it would be difficult to proceed without the consent of the major shareholder Naver, it is interpreted that Naver accepted Shin CPO's resignation. Notably, in March, Shin CPO gave up 37.4% (approximately 31.63 million shares) of his Line Yahoo stock options. Given that the stock option exercise period still had ample time remaining, this decision suggests that Naver was aware of the internal and external pressures for his resignation. Furthermore, with added pressure from the Japanese government to sell shares, Naver accepted this extraordinary measure.

Shin CPO's departure, who held significant influence at Line Yahoo, is seen as an attempt to ease nationality-related controversies. This aims to resolve platform sovereignty issues and the "anti-Naver" sentiment that have become hot topics in Japan, while maintaining shares to secure practical benefits.

Shin CPO is known as the "father of Line" for growing Line into Japan's number one messenger app. He is regarded as the right-hand man of Naver founder Lee Hae-jin, Global Investment Officer (GIO), and is also known to have a close relationship with SoftBank Chairman Masayoshi Son.

Shin CPO played a "keyman" role during the management integration of Line and Yahoo Japan in 2021. Initially, he served as an internal director of A Holdings, which oversaw the integration, and after the merger, he established a decision-making structure that facilitated the reflection of Naver's opinions. The board and the product committee, responsible for service-related decisions under the board, were composed equally of five members each from Line and SoftBank affiliate Z Holdings. In cases where opinions diverged in the product committee, Shin CPO held the final decision-making authority. This structure ensured that Naver could maintain leadership in management even after the integration.

With Shin CPO stepping down as an internal director, the Line Yahoo board will be composed entirely of Japanese members. The previous board, which had four internal directors and three outside directors, has been reorganized into a structure with two internal directors and four outside directors. Chairman Kawabe and President Idezawa retained their internal director positions. In addition to the existing three outside directors, Yuko Takahashi was newly appointed as an outside director. The new board is scheduled to begin its activities following the shareholders' meeting on June 18. President Idezawa stated, "The change to a majority of independent outside directors separates management from business operations and strengthens security governance."

Line Yahoo also announced plans to gradually end its consignment relationship with Naver. This is in response to administrative guidance from the Japanese government to separate IT infrastructure tasks previously entrusted to Naver. They plan to invest 15 billion yen (approximately 13 billion KRW) for technological independence. Beyond system and network operations, they will also distance themselves from Naver in service and business areas. They will terminate consignment collaboration on web search development and search verification for the Yahoo Japan portal, with detailed plans to be announced in July.