Minister hints at penalizing NHN for unfair practices

By Kim Yoo-chul

Choi Moon-ki Science minister

Science, ICT and Future Planning Minister Choi Moon-ki hinted at penalizing NHN, the nation’s dominant web portal that operates Naver, for its alleged unfair business practice.

But the minister stressed that the government will apply a “two-track” approach to NHN. The ministry plans to prod NHN to take measures to share growth with local suppliers, while continuing the probe into the mammoth portal.

NHN is being investigated by the anti-trust regulator over allegations that it exploited advertisers and software developers to maximize its profit and expand its market dominance.

“The ministry will encourage NHN to pursue shared growth with other industries and companies. But we will take action after the Fair Trade Commission wrap up its probe. NHN should be punished if it were found to have done something wrong,” Choi said in a luncheon meeting with reporters at the government complex in Gwacheon, south of Seoul, Thursday.

The minister pointed out that some businesses that NHN operate are against fair competition. “If NHN does something wrong, then we have to take action to force it to correct such practices.”

But Choi was cautious over stiff regulatory measures to the portal operator by saying that the ministry will continue to implement pro-business policies.

“We are trying our best not to regulate NHN too hard. Let’s see what happens,” he said.

NHN, headquartered in Bundang, Gyeonggi Province, has come under mounting criticism since last year for aggressively expanding operations into non-core businesses like real estate and wholesale markets, which lawmakers of the ruling Saenuri Party claim have driven smaller firms out of business.

The Internet giant has been trying to improve its image as a monopoly in the market by sharing returns with content developers in a more equitable way.

NHN CEO Kim Sang-hun recently said that it is mulling closing some of its non-core businesses.

“I’ve learned some insights from previous meetings with Larry Page of Google and Bill Gates. We discussed how to address key pending issues and how to develop in a positive way. We are set to announce new measures to help local content developers expand their businesses,” according to the minister.