The Naver Corp. web site organized on a display screen in Gimpo, South Korea on Sept. 9, 2021.
SeongJoon Cho | Bloomberg | Getty Pictures
Whereas synthetic intelligence chatbots like ChatGPT pose a risk to the search advert market, South Korean web large Naver sees the rise of AI as a chance for the corporate.
Naver is South Korea’s most used search engine, in keeping with Statista, commanding a 61.2% market share of month-to-month lively customers. In distinction, the ever ubiquitous Google has a 28.55% market share within the nation.
AI-powered chatbots like ChatGPT pose a risk to search engines like google as they’re able to present solutions to customers’ questions instantly, as a substitute of presenting a listing of webpages that the consumer has to flick through to search out a solution.
This might result in a faster search course of for the consumer — assuming all the data offered is appropriate.
If fewer individuals use search engines like google, that will result in a decline in search advert income, usually the most important income stream for his or her operators. In 2022, Alphabet generated over 57% of its income, or $162 billion, from Google searches alone.
Whereas Naver, like Google, additionally primarily operates a search engine, it additionally has different enterprise models, corresponding to its content material platform Naver Webtoon and multimedia cellular software Snow, fintech arm Naver Pay and an e-commerce platform in Naver Procuring.
Talking to CNBC’s Chery Kang in South Korea, Naver CFO Kim Nam-Solar says AI will likely be a “big alternative” for every of its companies, “whether or not it is enhanced search [results], whether or not it is [an] enhanced buying expertise, whether or not it is fintech and even in terms of Webtoon suggestions, and even Webtoon illustration instruments.”
He believes that AI will solely strengthen Naver’s choices, declaring that “AI is one thing that is not overseas to us, nevertheless it’s essential to every of our companies.”
By way of the consumer expertise, Kim says an AI-powered Naver would imply an enhanced search expertise, buying expertise in addition to journey suggestions for customers.
He believes that Naver is the most important go-to web site when it comes to journey itinerary searches. “So to the extent that AI can truly higher that have, I believe it is a sport changer for the consumer.”
In its first-quarter earnings presentation, Naver revealed that the corporate is ready to launch its “hyperscale AI” product, named HyperCLOVA X this summer season. The corporate mentioned it might “present generative AI-driven seek for customers and new custom-made providers for enterprises.”
Over the primary quarter, the corporate’s gross sales rose 23.6% year-on-year to 2.28 trillion received (1.72 billion), however its web revenue tumbled 71.2% to 43.7 billion received in contrast with the identical interval final 12 months. Working revenue stood at 330.5 billion received, a 9.5% enhance year-on-year.
Shares of Naver had been buying and selling 1.93% greater on Tuesday, constructing on their 5.56% achieve Monday after the corporate launched ends in the morning.