Anchor: South Korea's fair trade watchdog has slapped a hefty fine on the operator of the country’s dominant web portal Naver. It accused the tech giant of manipulating search algorithms to benefit the company’s online shopping site.
Park Jong-hong has this report.

Report: The country’s antitrust regulator on Tuesday accused Naver Corporation, the operator of the nation's leading search engine, of foul play and imposed a fine of 26-point-7 billion-won, or nearly 23 million US dollars.

It claimed that the company manipulated search algorithms in favor of the company's online shopping site by making search results stand out, thereby luring consumers to its shopping mall.

This is the first time ever that the Korea Fair Trade Commission has levied a fine on a technology platform operator for making algorithmic changes that favor a certain business.

According to the KFTC, Naver made algorithmic changes at least six times between 2012 and 2015 to give more exposure to its affiliated services while lowering the rankings of goods sold by competitors such as Gmarket and Interpark.

Naver also tweaked its algorithms to show more search results in connection to the company's payment engine, Naver Pay.

The KFTC said that as a result, the market penetration rate of Naver's shopping platform jumped more than five-fold from five percent in 2015 to more than 21 percent in 2018. 

It added Naver's competitors saw their market penetration rates fall during the four-year period.

Song Sang-min, director general at the KFTC, told reporters that Naver "deceived consumers and distorted competition" by manipulating search results and rankings.

In response, Naver said the search logic revision was part of an effort to show optimized results in line with the search needs of users and is unrelated with sidelining other companies.

Naver said it will appeal the ruling.
Park Jong-hong KBS World Radio News.