"Hard to Compete One-on-One with Google," CEO Han Seong-sook's Plea on 'Data Discrimination'

[Asia Economy Reporter Buaeri] "We cannot win in one-on-one competition with Facebook or Google. I hope regulations are implemented under the same standards." This is a remark made recently by Han Seong-sook, CEO of Naver, at a National Assembly forum. The reason why CEO Han, usually quiet by nature, made such a determined statement is because she believes government regulations are holding back domestic companies competing with global firms. A representative example is regulations related to personal information collection. Although the amendment to the Data 3 Act passed the National Assembly, the amendment to the Information and Communications Network Act, which would ease regulations on personal data collection, failed to be processed by the Assembly.

Naver and Kakao Suffer Data Discrimination

According to the industry on the 10th, companies like Google and Facebook obtain comprehensive consent for personal information with a 'one-click' during membership registration, ignoring domestic regulations, whereas domestic companies like Naver and Kakao obtain consent by distinguishing between mandatory and optional items. Domestic companies undergo complicated personal information consent procedures due to regulations such as the Information and Communications Network Act and the Online Personal Information Processing Guidelines. Current laws specify the 'principle of minimum personal information collection' and 'consent by purpose and item.' This structure inevitably results in domestic operators collecting less user data compared to overseas operators while complying with regulations.

For example, regarding location information terms of use, domestic portals must separately indicate this as an 'optional item' according to regulations. If users do not consent, location data cannot be utilized. On the other hand, Facebook or Google follow so-called 'comprehensive consent,' where if a user clicks the 'consent' button once, it is interpreted as agreeing to all items automatically. Accordingly, once consent for location information is obtained, services like photo location recommendation can be provided without additional consent. Conversely, domestic operators must separately obtain user consent according to the Information and Communications Network Act and the Korea Communications Commission guidelines to provide such services. The same principle applies to biometric information collection such as facial recognition. Facebook offers friend recommendation services using facial recognition. Under current regulations, a separate consent procedure is required, but Facebook does not follow this and instead uses the arbitrary judgment of 'comprehensive consent' without separate consent procedures.

The problem is that there is no proper means to sanction overseas operators who do not comply with domestic guidelines like this. A representative from the Science, Technology, Information and Broadcasting Communications Committee said, "Consent procedures for optional items are guidelines, so there is no proper way to sanction non-compliance," adding, "If overseas companies feel even slightly harmed, they protest through various diplomatic channels, so it is true that our government cannot act rashly."

Ahn Sung-woo, CEO of Zigbang; Yeo Min-soo, Co-CEO of Kakao; Han Sung-sook, CEO of Naver; Kim Beom-jun, CEO of Woowa Brothers, and other key attendees are engaged in a discussion at the launch ceremony of the Digital Economy Innovation Research Forum held at the National Assembly on the 6th. Photo by Yoon Dong-joo doso7@

Re-promotion of Legal Amendment on 'Minimum Collection' Clause

While such regulations remain unaddressed, domestic operators have become disadvantaged compared to overseas operators in utilizing big data and developing services. An industry insider said, "Overseas companies do not face special sanctions even if they do not follow regulations, but domestic companies have no choice but to watch the government cautiously for fear of future disadvantages in other businesses," adding, "The quality of information recommendations can vary depending on the amount of personal data collected. For portal sites, small service differences can lead to competitive gaps in the long term."

There have been efforts to resolve these issues. During the 20th National Assembly, a bill to remove the 'minimum collection' clause from the Information and Communications Network Act was proposed but faded away amid discussions on the Nth Room Prevention Act. Removing this clause would allow Naver and Kakao to obtain 'comprehensive consent' like Google and Facebook, enabling support for various services with a single consent. Park Seong-joong, opposition party whip of the Science, Technology, Information and Broadcasting Communications Committee, is considering reintroducing the related amendment in the 21st National Assembly. A staff member from Park's office said, "We are aware of the problem of domestic companies suffering from reverse discrimination," and added, "We are reviewing the direction to supplement and reintroduce the amendment to the Information and Communications Network Act to resolve the reverse discrimination issue."

This content was produced with the assistance of AI translation services.