FTC expands probe into NHN's marketing unit
By Na Jeong-ju
The antitrust regulator is looking into suspicious deals between NHN, the operator of the nation’s largest portal Naver, and its advertising and online marketing unit, NHN Business Platform (NBP), industry sources said Tuesday.
The Fair Trade Commission (FTC) suspects that NHN misused its dominant status to help NBP expand its businesses.
The NBP recently launched an online real estate brokerage service, triggering complaints from realtors. The association of real estate brokers has urged lawmakers and the government to punish the firm, saying its brokerage service violates fair competition rules.
“The NBP’s service is threatening existing brokerage firms. Some have seen their earnings drop by 80 percent since the service was launched,” said Choi Hyun-kil, a researcher at the Korea Association of Realtors. “It’s dealing a blow to hundreds of mom-and-pop brokerage offices nationwide, too. They will have to give up their businesses unless NHN is properly regulated.”
An FTC spokesman refused to confirm whether the probe into NBP has something to do with its brokerage service, only saying that he is not authorized to comment on the ongoing probes.
NHN established the unit in 2009 after spinning off its advertizing, sales and infrastructure development divisions. The NBP is fully owned by NHN.
Last week, a team of FTC investigators visited the NHN’s head office in Seongnam, Gyeonggi Province, to secure data concerning inter-affiliate transactions. The regulator also asked NHN’s subcontractors to submit documents about their deals with the Internet giant. Naver is a dominant portal that has about a 70 percent market share.
The FTC is currently investigating chaebol affiliates that hold monopolistic positions. President Park Geun-hye has called for “economic democratization” to establish fairer business relationships between small and big firms.
One industry source described the FTC’s probe into NHN as a “witch hunt,” saying many other big firms started their own real estate brokerage services in recent months.
“KB Kookmin Bank, Woori Bank and Mirae Asset are also providing similar brokerage services. It’s unfair to target only NHN,” the source said.