SK Communications Co., the operator of South Korea's online networking portal Cyworld, said Friday it has decided to withdraw its European unit because of sluggish prospects due to strong regional competitors.
The decision to liquidate Cyworld Europe was made at a board meeting on Thursday due to strong performances by similar services such as StudiVZ and Skyrock, SK Communications said.
In 2006, SK Communications launched its European subsidiary Cyworld Europe together with Germany's T-online, a subsidiary of Germany's Deutsche Telekom, to introduce its popular flagship Cyworld service.
Cyworld is South Korea's largest online community service similar to MySpace.com in the United States. Around 18 million people run their blog-style homepages on the site, uploading photos, comments and other multimedia contents.
SK Communications added that it plans to review the business strategies of its five other overseas units including those in the U.S., China and Japan to streamline global competitiveness.
"(We) will strengthen investments in subsidiaries that show growth potential and profitability," Park Sang-joon, chief executive officer of SK Communications, said.