Fair Trade Commission Investigates Allegations of Rival Idol Defamation... Kakao Says "Not True"

Investigation into Facebook Page 'Idol Yeonguso' Entrusted to Kakao Entertainment for Management

Seongnam City Kakao Pangyo Ajit scene. Photo by Yonhap News

[Asia Economy Reporter Lee Isul] The Fair Trade Commission (hereinafter referred to as the FTC) investigated Kakao Entertainment following allegations that it posted online content disparaging rival idols. Kakao Entertainment denied the allegations.

According to industry sources on the 17th, the FTC sent investigators to Kakao Entertainment in Pangyo, Seongnam-si, Gyeonggi-do, the previous day to conduct an on-site investigation. Recently, online communities raised suspicions that posts favorable to Kakao Entertainment’s affiliated singers were uploaded on the 'Idol Yeonguso' (Idol Research Institute) page, while certain competing groups were subjected to reverse viral attacks. Idol Yeonguso was a Facebook page posting entertainment-related content, which had 1.32 million followers but was recently shut down.

The FTC is reportedly examining whether Kakao Entertainment intentionally disparaged rival idols or promoted its own idols through the Facebook page 'Idol Yeonguso,' which it had outsourced for operation. This could potentially violate the Fair Trade Act, which prohibits unfairly inducing competitors’ customers to transact with oneself.

The 'Idol Yeonguso' page was involved in copyright infringement controversies, during which the actual owner of the account was revealed to be Kakao Entertainment. Since Kakao Entertainment, which has multiple entertainment agencies under its umbrella, did not disclose its ownership, this could be considered a violation of the Act on Labeling and Advertising.

Regarding the FTC investigation, a Kakao Entertainment official stated, "It is true that an investigation is underway," but added, "It is difficult to comment on detailed causes and purposes."

On the reverse viral allegations, the official said, "This is completely untrue." The official explained, "We confirmed that some posts infringed copyrights due to the operating agency’s mismanagement of the 'Idol Yeonguso' page. We deeply regret not managing it thoroughly and closed the account immediately upon recognizing the issue."

Meanwhile, the FTC is also investigating allegations that Kakao Entertainment abused its superior bargaining position during a web novel contest by unfairly acquiring copyrights to participants’ submitted works. Additionally, investigations or sanction procedures are underway regarding Kakao Mobility’s suspected preferential treatment of calls (passenger requests) and blocking calls from competitor affiliated taxis.

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