First Workday After Data Center Fire... Kakao and SK C&C Offices Calm Down Amid Mixed Feelings

Formation of Kakao Emergency Response Committee
Pangyo Atmosphere 'Unsettled'... "Helpless to Respond to Stock Price Drop, etc."

On the 17th, fire officials are conducting an on-site investigation at the SK C&C Data Center fire scene in Pangyo, Bundang-gu, Seongnam-si, Gyeonggi-do.

[Asia Economy Reporter Seungjin Lee] "The current atmosphere at the company is no different from a mourning house. The stock price is falling, and we are at a loss about how to respond moving forward."

On the afternoon of the 17th, Kakao employee A, whom we met at the Pangyo Ajit in Seongnam-si, Gyeonggi-do, described the mood on the first day back at work following the fire incident at the SK C&C Pangyo Campus (Data Center) on the 15th. Kakao entered an emergency management system the day before. Many employees who had been working remotely came to the office for meetings and emergency response efforts.

Kakao experienced outages in most of its major services, including KakaoTalk, due to the data center fire. Some services such as Melon and Webtoon have started compensating users for damages, but most services affected operationally have yet to establish concrete compensation plans. Currently, inquiries about compensation for damages caused by service disruptions over the past weekend continue for services like 'KakaoTalk Shopping.'

Employees have been working emergency shifts since last weekend. Kakao formed an emergency response committee the day before, chaired by co-CEO Hong Eun-taek, consisting of three subcommittees: the Cause Investigation Subcommittee, the Disaster Response Subcommittee, and the Compensation Measures Subcommittee.

Co-CEO Namgung Hoon also delivered an apology and encouragement message to employees on the day, aiming to stabilize the subdued internal atmosphere. Namgung encouraged employees who worked overnight to respond to the incident and conveyed that prioritizing the allocation of physical and human resources to prevent recurrence of such incidents would be a key task, promising unwavering support.

Currently, the SK Pangyo Campus resumed power supply at 1:30 a.m. on the 16th, and recovery is progressing at about 95%. However, the exact timing for the normalization of Kakao’s servers remains unknown.

Last weekend, due to a fire at the SK C&C data center, major Kakao services including KakaoTalk were suspended. On the 17th, recovery work is underway at the SK C&C data center in Seongnam, Gyeonggi Province.
Seongnam ? Photo by Kang Jin-hyung aymsdream@

The data center where the fire occurred last weekend remains in a state of disorder. The fire investigation, which began over the weekend, continued until the afternoon of this day. Although two days have passed since the fire, the area still carried a pungent smell caused by the fire.

SK C&C employees near the data center expressed frustration, all searching for news articles related to the fire. One SK C&C employee said, "Currently, even the employees do not know the cause of the fire, and since there is no shared information, we are only relying on the investigation results reported in the news."

The police investigating the data center fire confirmed CCTV footage showing sparks igniting from batteries installed on the third basement floor at the time of the fire. The first on-site investigation conducted the day before revealed that the ignition point was around the UPS (Uninterruptible Power Supply) 3E-1 rack on the third basement floor. The cause of ignition is presumed to be electrical factors related to the battery or the area around the rack.

Meanwhile, the securities industry expects that this incident will have some impact on Kakao’s fourth-quarter sales. The revenue impact from this service disruption is categorized into lost sales and user compensation.

The interruption of Kakao-related services lasted about 10 hours, but sales from Bizboard ad sales suspension, mobility, and gift services for one to two days were lost. Subscription-based services such as Webtoon, emoticons, and Melon are providing users with free usage rights as compensation, and the fourth-quarter sales are expected to decrease by up to 1-2%. However, since SK C&C was responsible for managing the fire, the revenue loss due to user compensation is expected to be limited, depending on the damage claim against SK C&C.

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