SEOUL, South Korea — Tech giant Naver Corp. has not yet decided how to respond to Tokyo's pressure on LY Corp., its joint venture partner in Japan, regarding the mobile messenger service Line. During a conference call on Friday discussing the company's first-quarter earnings, CEO Choi Soo-yeon described the situation as part of a broader strategic review.
According to Yonhap News Agency, the company is evaluating the situation as it relates to its mid-to-long-term business strategy rather than merely deciding whether to comply with Tokyo's directives. She noted that Naver is in "close communication" with the Seoul government, including the Ministry of Science and ICT, to navigate the issue. The guidance from Japan's Ministry of Internal Affairs and Communications earlier this year suggested LY should reduce its reliance on Naver, recommending a transfer of its stake to SoftBank. This move is part of efforts to address concerns about data security and is seen as "exceptional" by the Naver CEO.
Choi mentioned that the potential separation of infrastructure, which Naver provides to LY as a technological partner, could impact their infrastructure sales, but no other business areas would be immediately affected. This statement marks Naver's first official response to the ongoing situation involving its joint venture with SoftBank and the Japanese government's administrative guidance. The Seoul science ministry has expressed its intent to monitor the situation and support Naver as needed, although it pointed out that the administrative actions from Tokyo do not directly affect bilateral relations between South Korea and Japan.
LY, meanwhile, is reportedly accelerating its plans to decouple its systems from Naver by December 2026 to enhance its safety management protocols, following the guidance from Japan.