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Daum, Naver Squeezed Between Rock, Hard Place

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By Kim Tong-hyung

Staff Reporter

Daum Communications, a key portal running hanmail services, Thursday sent apologies online to its 20 million-plus subscribers a day after causing a critical error in the log-in function that directed users to somebody else's inbox.

In a bizarre twist of events, the Daum apologies ended up in spam boxes.

This embarrassing snafu comes after a complicated tug of war involving the new media outlet regarding the government's controversial decision to resume U.S. beef imports. Opposing the new media is the government, wanting to regulate its growing power; and big print media outlets, apparently scared of a loss in their market share.

Daum, the country's largest e-mail provider, said that the accounts of about 430,000 subscribers were exposed to third persons, a malfunction company officials explain occurred during efforts to upgrade mailing services.

The incident deals a serious blow to the public image of Daum, something the company had so carefully built, and with class-action lawsuits expected, the fallout could be painful. With its online discussion site, Agora, becoming popular among anti-government bloggers, Daum had enjoyed status as the ``people's portal," leading to an increase in traffic. However, the e-mail blunder is likely to eliminate a large part of that sympathy.

``It's really hard to deal with all these problems at once," said a Daum employee.

``The regulations risks are looming larger, the fight against newspapers is getting fiercer, the National Tax Agency is investigating us, and now this," he said.

Meanwhile, NHN, operator of the country's most popular portal Naver and Daum's chief industry rival, has its own problems to deal with as the industry's standard bearer.

With the Lee Myung-bak government kicked in the teeth by bloggers over the controversial decision to resume U.S. beef imports, beleaguered bureaucrats have been considering new ways to monitor the Internet. Conservative newspapers, such as the ``Big Three" of Chosun Ilbo, JoongAng Ilbo and Dong-A Ilbo, have also been complaining about the increasing role of portals in news circulation and have been calling for tighter regulations. The newspapers are currently refusing to provide their content to Daum.

As the undisputed industry leader, NHN had been reluctant to get too involved in the political debate, even announcing plans to give up news editing on its main page and instead provide direct links to the Internet pages of news papers and other media outlets.

However, with the threat of government regulations becoming real, NHN is taking a bolder stance. NHN Thursday filed a defamation lawsuit against lawmaker Jin Seong-ho of the Grand National Party (GNP). Jin, who worked in Lee's presidential camp during the elections, said at a GNP meeting last October that ``Naver has been suppressed but Daum remains a bomb," commenting on the coverage of the presidential race by the portals. NHN will also join Daum in a coalition of the country's six largest Internet companies to counter a regulatory move to strengthen Web surveillance and censorship.

The Korean Communications Commission (KCC) recently announced plans to rewrite the current telecommunications law to mandate portals to immediately remove content claimed as fraudulent or slanderous for a minimum of 30 days, stressing the need to curb ``cyber bullying". The move has been denounced by critics as an authoritarian approach. The Ministry of Justice is considering introducing a ``Cyber Defamation Law," promising stricter punishment for those accused of being Internet vandals.

thkim@koreatimes.co.kr