Kakao

Kakao Corporation
Native name
 주식회사 카카오
Jusikhoesa Kakao
Public
Traded as KRX: 035720
Industry Internet
Founded October 1, 2014
Headquarters Jeju City, Jeju Special Self-Governing Province, South Korea
Key people
 Kim Beom-soo (chairman)
Rim Ji-hoon (CEO)
Lee Wooram (COO)
Products Kakaotalk, Hanmail
Owner As of January 2016:[1]
Kim Beom-soo (18.80%)
KCUBE Holdings (14.90%)
Tencent Holdings Ltd. (13.54%)[2][3]
Star Invest Holdings Ltd. (8.30%)
WeMade Entertainment Co., Ltd. (3.50%)
SK Planet Co., Ltd. (2.00%)
Subsidiaries LOEN Entertainment, Inc.
(76.40%)
Website www.kakaocorp.com
Kakao
Hangul 카카오
Revised Romanization Kakao
McCune–Reischauer K'ak'ao

Kakao (Korean: 카카오) is a South Korean internet company established in 2014. It was formed from a merger of Daum Communications and Kakao to Daum Kakao in 2014.[4] Daum Kakao changed its name to Kakao in 2015.[5]

On May 28, 2015, the company acquired Path, a US social media company that had met with success in Asia.[6] On January 11, 2016, Kakao announced it is going to buy 76.4% stake in LOEN Entertainment, Korea's top online music service with $1.5 billion.[7]

Kakao Services

Community

Entertainment

Fashion

Finance

Transportation

Others

New CEO

In 2014, Kakao Corp and Daum merged through an equity swap, creating a company with a 3.4 trillion won (about $2.9 billion USD) market capitalization. Kakao is the maker of KakaoTalk, South Korea’s top messaging service, while Daum is one of the country’s largest Internet portal sites. The new entity Daum Kakao was valued at close to a massive sum of 10 trillion won (US$9.45 billion).[8] The company then changed its name to 'Kakao' and named Rim Ji-hoon as its CEO.[9][10]

The new name will help bolster the corporate brand as a mobile life platform maker, which isn't fully expressed through the current name representing two merged firms. They want to clarify their identification as a mobile company with a new CEO. And there are also some other reasons that they had to change CEO.[11] Gambling and censorship problems still remain with Kim-beom-soo(former CEO for Kakao Talk), so the board of Kakao decided to change its CEO. The board of Kakao think new flowing business models should go with new one.

Kakao's New Vision

The new CEO established a new vision for the company, with the title 'Connect everything'. This new philosophy suggests that the company wants to become a bigger player in the global market.

They also have plans to evolve as a '020 company' in Korea. Many new business models are heading up to the 020 sections.

Kakaotalk censorship

When the announcement by the Korean government that it would tighten its real-time monitoring to prevent people from spreading false information, for which the company cooperated fully by providing reams of conversation data. KakaoTalk users expressed their displeasure to the censorship by saying that they would migrate to other messenger services. Because of this, as many as 1.5 million users have recently signed up for the hitherto obscure mobile messenger service "Telegram," a German-made app known for its security.[12]

Daum Kakao has explained the censorsip, saying, "It is unthinkable not to follow the rules in a constitutional country."

"The move (by Daum Kakao) reflects users' repulsion and fear against cyber censorship," said Yoo Ki-hong, a spokesman of the main opposition New Politics Alliance for Democracy. "The government should understand the sense of resistance of the people on the issue, rather than justifying its execution of warrants."

Kakao Corp chairman accused of gambling

Kakao board chairman, Kim Beom-soo, has been accused of gambling in Las Vegas in the early years of Kakao Corp from 2007-2010. Overseas gambling is illegal under the Korean law. Korean prosecutors have reportedly obtained information from the U.S. Department of Justice and the Department of Treasury that Kakao mobile messenger founder Kim had spent 20 hours and 51 minutes at the Bellagio Hotel in Las Vegas in 2007, when he served as NHN global CEO. He betted an average of $2,440 per session and lost $16,993 within the night, local Hankook Ilbo newspaper reported.[13] The company’s decision to comply with the prosecution’s warrants requesting monitoring of chatting records in criminal cases, a reversal from its earlier stance, with rumors that he succumbed to the investigative powers.[13]

Internet bank

Kakao was approved to launch the nation's first Internet-only banks next year. The internet bank will engage in the same business as commercial banks, including processing deposits, loans and wiring money. Consumers will no longer need to visit bank to open new bank accounts or get loans. Their business plan was considered innovative, and they are going to attract customers relatively easily, based on Kakaotalk users. committee said in a statement. It seems that simple and easy financial services through biggest messenger and everyday messenger.[14]

New business model: Taxi and Gaming business

Kakao had a great challenge about their new profit. After merging with Daum, Kakao's physical boundary was larger than before but their revenue was still only from advertising. They had to make new profit model.

Kakao kept denying their plans on gaming services, but they seem to be ready to release their new business item. Some games they seem to have ma Go-stop, ba-duk, poker, and Chinese chess.[15]

Another business model taxi, they already successfully launched 'kakao taxi'. And they are also ready for the 'Kakao taxi black'. Kakao taxi black is for the people who want to use luxurious taxi. That service uses only like Mercedes Benz, Lexus and BMW. Drives wear signature and uniforms. Riders can reserve it through Kakaotalk and fares starting with W8,000. Now it is only executed in Seoul and operated under the agreement with Seoul taxi association.[16]

References

  1. ↑ ""카카오 주주? 로엔 주주?" SK플래닛의 선택은... - 머니투데이 뉴스" [Kakao shares or LOEN shares? SK Planet picks..)]. 머니투데이.
  2. ↑ "Tencent Invests US$63M into KakaoTalk the Korean WeChat". TechNode. 17 May 2012.
  3. ↑ "Tencent expansion in Asia may be bolstered by Kakao connection". South China Morning Post.
  4. ↑ "kakao > About > History". Kakao Corp. Kakao. Retrieved 9 October 2015.
  5. ↑ "Daum Kakao Sets Sail Under New Name". The Chosun Ilbo. Seoul. 24 September 2015. Retrieved 9 October 2015.
  6. ↑ "Path Sells Its Social Networking App To Daum Kakao". TechCrunch. Retrieved 28 June 2015.
  7. ↑ "Chat App Kakao Buys Majority Stake In Korea's Top Online Music Service For $1.5B". TechCrunch. 11 January 2016. Retrieved 11 January 2016.
  8. ↑ "Daum and Kakao merge, massive valuation puts them head-to-head with Naver-Line". techinasia. Retrieved 2014-10-01.
  9. ↑ "Daum Kakao to change its name to Kakao". yonhapnews. Retrieved 2015-09-01.
  10. ↑ Russell, Jon. "Korea’s Daum Kakao Brings In 34-Year-Old CEO To Grow Its Messaging Business Overseas". TechCrunch. Retrieved 2016-01-01.
  11. ↑ "Kakao Changes CEO, Name to Highlight Corporate Identity as Leader in Mobile Market". businesskorea. Retrieved 2015-09-24.
  12. ↑ "Daum Kakao in Serious Danger after "Censorship" Announcement". hankyung. Retrieved 2014-08-08.
  13. 1 2 "Kakao chairman again embroiled in gambling scandal". koreaherald. Retrieved 2015-10-11.
  14. ↑ "Kakao, KT Surge After South Korea Grants Online Banking Permits". bloomberg. Retrieved 2015-11-29.
  15. ↑ "Kakao bets on online board games and gambling to nab elusive profitability". cnet. Retrieved 2015-09-20.
  16. ↑ "Kakao Launches Luxury Taxi Service". chosun. 2015-11-04.
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