Gov't to set up cybersecurity task force after Kakao disruptions

President Yoon Suk-yeol gestures as he answers reporters' questions at the presidential office in Yongsan District, Seoul, Monday. Yonhap

Yoon says Kakao is virtually part of national infrastructure

By Nam Hyun-woo

The presidential office announced a plan to establish a cybersecurity task force team to thwart threats and risks that can disrupt the nation's key infrastructure after disruptions to Kakao's ubiquitous messaging and settlement functions wreaked havoc on the nation over the weekend.

Kim Sung-han, director of the National Security Office, will preside over a meeting with ranking officials from the science and defense ministries, the National Intelligence Service, Supreme Prosecutors' Office and the military.

The disruption of Kakao's services "not only made the lives of ordinary citizens tougher, but was also an incident that can impact national security. The incident proved that such worries are real and can happen," an official from the presidential office told reporters. "Thus, there was a shared view among senior presidential secretaries that we need a task force team that can regularly check cybersecurity."

The announcement of the cybersecurity team came after President Yoon Suk-yeol presided over a meeting with senior presidential secretaries.

Senior presidential secretary for public relations Kim Eun-hye said in a briefing that platform malfunctions stemming from cyberattacks or disasters may expand to systematic risks, and platform service providers should make preemptive investments for cyber security or data stabilization. Thus, it is important to "have a scheme which checks whether a monopolistic platform company is fulfilling its social responsibility to prevent systematic risks," she said.

The presidential office unveiled the plan to establish the cybersecurity task force hours after the president stressed that messaging and networking services provided by Kakao are practically a part of Korea's national infrastructure and hinted at the possibility of government intervention in case of major disruptions in the future, like the service outage caused by a fire over the past weekend that paralyzed Kakao's widely-used functions.

He made the remarks to clarify why the government needs to intervene in the private sector. Yoon said the government should explore follow-up measures and preventive steps considering the ubiquitousness of Kakao's services.

On his way to the presidential office, Monday, Yoon told reporters that he ordered the minister of science and ICT to oversee the recovery process of Kakao's services and explore government measures to prevent a recurrence.

"It is a network operated by a private company, but equivalent to a national infrastructure network for the public," Yoon said. "Since the National Assembly is paying a lot of attention to this matter, it is important to set up regulatory schemes for prevention and come up with reporting systems to enable fast announcements in case of such an incident."

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Yoon's comments came after the fire at SK C&C's data center caused a major shutdown of Kakao's messaging, commerce, banking, map, ride-hailing, music streaming and other services for more than 10 hours starting from Saturday. Reportedly, more than 32,000 Kakao server devices were set up in the data center in Pangyo, Gyeonggi Province.

The impact became more serious because other companies' apps and services tied to Kakao's verification systems also suffered disruptions.

As the disruptions caused major difficulties across Korea's social and economic activities, questions were raised on the knock-on effects of Kakao's dominance in the communication market, as well as debate on the necessity of government intervention to prevent damage caused by structural flaws. Kakao's flagship service, messaging app Kakao Talk, commands an 87-percent market share as of last year.

"I believe in a free market economy and respecting entrepreneurs' autonomy and creativity, but this is possible only when the market distributes resources and income reasonably within its own fair competition," Yoon said. "If the market is distorted by a monopoly or serious oligopoly, and it involves national infrastructure, the country should make necessary systematic responses for the national interest."

Yoon added that the Fair Trade Commission is looking into the matter.

The comments triggered speculation over whether the government will change its policy direction regarding online platform companies such as Kakao.

In its policy goals announced in May, the Yoon administration set "autonomous regulation" as its principle on platforms to allow businesses to introduce innovative services. As Kakao's disruptions resulted in a digital blackout, however, not only Yoon but also the ruling People Power Party (PPP) is voicing the necessity of legislation to prevent similar incidents from paralyzing Korea, which is considered one of the most digitally-connected countries in the world.

Ruling People Power Party floor leader Joo Ho-young, left, speaks during a party meeting at the National Assembly in Yeouido, Seoul, Monday. Joint Press Corps

"So far, Kakao has been expanding its business, having 134 affiliates in mobility, commerce, finance and other sectors," PPP floor leader Joo Ho-young said. "However, the company has yet to operate its own data center and concentrated its main system to a single venue. … Given that we have to prepare ourselves from North Korea's cyberattacks on our networks, relevant measures are urgently needed for the sake of national security."

Main opposition Democratic Party of Korea (DPK) floor leader Park Hong-keun also said, "The cause of the digital blackout was that the company did not set up backup systems properly to reduce costs."

Park added, "It is suspicious that Kakao even has a crisis response manual given its vulnerability to this fire. And this is the result of its negligence to the responsibility that comes along with its dominant market status."

Main opposition Democratic Party of Korea floor leader Park Hong-keun speaks during a party meeting at the National Assembly in Yeouido, Seoul, Monday. Yonhap

The PPP said it will pursue a bill designating data centers as facilities that are managed under the government's disaster control plan. A similar bill was tabled in 2020, but did not pass the National Assembly due to concerns over state influence over private property.

The DPK also said it will start reviewing a revision to the Framework Act on Broadcasting Communications Development in order to allow the government to include such data centers under its disaster control plans.

Also, the National Assembly's Science, ICT, Broadcasting, and Communications Committee decided to summon Kakao founder Kim Beom-su and SK Group Chairman Chey Tae-won to testify at the committee's audit of the science ministry scheduled for Monday next week. Kakao co-CEO Hong Eun-taek and portal giant Naver's founder Lee Hae-jin were also asked to appear.