Since Lee Hae-jin's return, Naver has been fervently developing artificial intelligence (AI) technology. In the first half of this year alone, it spent over 1 trillion won on research and development. This is the largest amount since Naver was founded. In contrast, Kakao reduced its research and development spending.
◇ Naver's annual R&D investment approaches 2 trillion won
According to Naver's semi-annual report on the 19th, the research and development expenditure for the first half of this year was 1.0386 trillion won, an increase of about 16% compared to the previous year (895.7 billion won). This marks the first time that research and development expenditure has surpassed 1 trillion won on a semi-annual basis.
The industry expects that this year Naver will be the first to exceed an 'annual 2 trillion won' research and development budget. This is due to the promise made by CEO Choi Soo-yeon, who said, "To protect the domestic AI ecosystem, we will continue to invest 20-25% of our revenue in research and development." Last year, Naver recorded an unprecedented revenue of 10.7377 trillion won. Therefore, it needs to invest at least 2.1 trillion won this year to fulfill the promise. Recently, Naver's selection as the national representative AI business operator is also seen as a reason why AI investments will increase further in the second half.
Since the return of the chairman in March, Naver has been focusing on enhancing its competitiveness in the AI business. The development of an integrated AI agent is seen as the first step. During the second-quarter earnings conference call, CEO Choi noted, "We will unveil an integrated AI agent that penetrates the entire Naver ecosystem. I will ensure it becomes an essential service in the AI era." An IT industry official explained, "This signifies that Naver will accelerate its 'omni-service AI' strategy, which internalizes AI across all service areas, including search, shopping, local, and finance."
Along with the integrated AI agent, another area of focus for Naver is the development of 'omni-modality' AI models. Omni-modality AI models are technologies that integrate and understand/generate various types of data, including text, images, audio, and video. According to Grand View Research, the global omni-modality AI model market is expected to grow from approximately $1.7 billion (around 2.36 trillion won) last year to about $10.8 billion (around 16 trillion won) by 2030, expanding more than six times.
◇ Kakao reduces R&D… Lee Hae-jin as the focal point for AI investment
Recently, Kakao, which was eliminated from the national representative AI selection, spent 637.4 billion won on research and development in the first half of this year. This is a decrease of about 2% (12.6 billion won) compared to the previous year (650 billion won). After Kakao's founder, Kim Beom-soo, stepped down from management in March for health reasons, the company's research and development investments dropped. There is a perspective that Kakao's elimination from the national representative AI business operator selection was influenced by the absence of a founder to serve as a focal point for AI technology investment. An official from the platform industry stated, "Chairman Lee Hae-jin, who returned to management after seven years, played a pivotal role in AI investment," adding that it contrasts sharply with Kakao's reduced investment.
In July, Kim Yoo-won, the CEO of Naver Cloud, mentioned, "Since Lee Hae-jin's return, we are making a vital investment in research and development in the AI field. The investment is planned to far exceed previous levels."