Naver pulls back from messaging app Line following data breach

Naver will reduce its cybersecurity ties with Line following the messaging app's massive data breach in October.

Logos of Yahoo Japan and the former Line Corporation [AP/YONHAP]

Naver, facing pressure from the Japanese government, will reduce its cybersecurity ties to the operator of popular messaging app Line.

Line Yahoo (LY), which operates both Line and Yahoo Japan, disclosed its intention to separate its system and network configuration from Line's subcontractors, Naver and Naver Cloud, by 2026 in a report filed to Japan's Ministry of Internal Affairs and Communications on Monday.

A Holdings, a 50-50 joint venture of Naver and Softbank Group, owns a majority 64.4 percent stake in LY. The messaging service has some 96 million users in Japan.

The report follows a massive data breach in October where 510,000 items of personal information about Line users, business partners, employees and other personnel were leaked through Naver Cloud. In response, Japan's ministry ordered LY to outline a set of measures to prevent such leaks in the future, as well as their implementation status, by April 1. It also requested that the operator review its capital relationship with Naver.

LY said it had conducted an on-site inspection of Naver Cloud with a third-party company and requested revisions to the cloud provider's safety measures.

It has further request that “related companies review” its capital relationship with Naver, per the report.

“Our Nominating and Remuneration Committee has begun discussions on the review of our management system to enable appropriate management and supervision over Naver, our subcontractor,” the report continued, adding that “necessary announcements” would be made in the future.

Naver and Softbank Group held informal talks last month to discuss reducing the former’s stake in LY, Nikkei Asia reported recently.

A Naver spokesperson declined to comment on the matter.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]