May 17, 2024

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[THE INVESTOR] Naver’s traffic and revenue from advertising may decline from introducing outlinks to news stories but the effect will be limited, said KB Investment and Securities on May 10. 

The internet portal giant announced that it will completely stop editing news and actively seek to bring in a service that will directly link to news media. 

Although there are concerns that this will inevitably hurt its earnings, Naver has already been splitting the revenue from ads, besides that from the news articles it directly arranges, with the media at 30:70 ratio. Revenue from advertising only accounted for 11 percent of the whole company’s last year, and profit from news is estimated to be approximately 10 billion won (US$9.29 million), said analyst Lee Dong-ryun.

It is likely to convert to a system that will expose its own service instead on the main page that will more easily lead the traffic to profits, forecast the analyst.

By Hwang You-mee (glamazon@heraldcorp.com)