Image: Kakao Talk logo. Credit: Kakao.
Life in South Korea would be impossible without Kakao, the quintessential “super app” people use to chat, call taxis, order food and send money. (Picture Elon Musk’s vision for Twitter, if you can make sense of it.) So dependent is South Korea on Kakao Talk 카카오톡, the messaging app that serves as the backbone of the company’s services, a brief KakaoTalk outage after a data center fire was deemed “a critical matter of national security.” (See previous coverage, “Kakao Talk Outage Strands Korea.”)
But under the Yoon Suk-yeol 윤석열 administration, Kakao has faced legal threats from all directions. The Financial Supervisory Service 금융감독원 is investigating Kakao Entertainment 카카오 엔터테인먼트 for potential charges of stock manipulation in its acquisition of K-pop giant SM Entertainment SM 엔터테인먼트. (See previous coverage, “The K-pop Power Struggle.”) The Korea Fair Trade Commission 공정거래위원회, meanwhile, has been investigating Kakao Mobility 카카오 모빌리티 for engaging in unfair trade practices by shutting down calls from other taxi apps for ridesharing drivers.
Now the president is getting directly involved. In a November 1 special meeting on economic issues, Yoon unloaded on Kakao Mobility, calling the company “predatory” for engaging in “the most unethical forms of anti-competitive practices” and saying “the government must penalize it.” The next day, the National Pension Service 국민연금, which with a 5.4% stake is Kakao’s fourth largest shareholder, announced it would take a more active role in Kakao’s management.
Kakao hardly has a clean record when it comes to anticompetitive behavior, but such a direct attack by the president against a corporation already the subject of multiple investigations damages the apparent objectivity and rigor of those investigations. For many, the NPS’s announcement will only confirm their most cynical suspicions. During the Park Geun-hye 박근혜 administration, Health Minister Mun Hyeong-pyo 문형표 and NPS chief Hong Wan-seon 홍완선 went to prison for using shares of stock held by the NPS to pave the way for the third-generation succession of the Samsung Group 삼성 그룹, after Samsung heir Lee Jae-yong 이재용 bribed Park’s confidant Choi Sun-sil 최순실.