Korea’s top portal Naver considers exporting search technology to Japan

[Courtesy of Naver and Yahoo Japan]

South Korea’s top portal Naver Corp. is pushing to export its search technology to Japan in a bid to expand the global presence of its own version of ChatGPT amid growing popularity of generative artificial intelligence (AI).

The entry into the Japanese market, if successful, is expected to serve as the opportunity for Naver to share the Korean version of ChatGPT with other global markets such as Southeast Asia.

Maeil Business Newspaper has learned Monday that Naver is considering a plan to apply its search technology to Japan’s largest portal operator Yahoo Japan Corp.

Yahoo Japan currently bases its search engine on Google LLC’s technology and is known to be paying Google tens of billions of won a year for the technology.

Yahoo Japan is a subsidiary of Z Holdings Corp., which is part of A Holdings Corp., a Japanese joint venture between Naver and SoftBank Group Corp.

Naver is known to be in close discussion with SoftBank about the plan. Given that Naver and SoftBank are planning to merge Line Corp. and Yahoo Japan that are under Z Holdings in October under the name of Line Yahoo to create more synergy between the two companies, industry insiders note that Naver is highly likely to export its search technology to the Japanese company.

“Naver’s LINE and SoftBank’s Yahoo Japan are currently discussing changing the search engine that goes into Yahoo Japan from Google’s technology to Naver’s technology after their merger,” said an unnamed official from the information technology (IT) industry. “We expect the merger to create complete synergy.”

Naver, which has enjoyed a dominant position in the Korean portal market, has seen its market share drop below 60 percent amid Google’s rapid expansion in the country.

Concerns rise that the Korean AI ecosystem may become dependent on global big tech companies as generative AI services led by U.S. big tech companies such as OpenAI, Microsoft Corp., and Google are gaining popularity across the world.

In response, Naver, which is at the forefront of generative AI development in Korea, is seeking to expand its own AI ecosystem centered on the language of its neighboring country, with an aim to expand the global reach of its large-scale language model “HyperCLOVAX.”