South Korea’s dominant search engine, Naver Corp., is facing a formidable challenge as global Big Tech companies like Google and Microsoft, armed with advanced artificial intelligence technology, make significant strides in the market. Naver’s long-standing reign as the undisputed leader in the domestic search engine market is being threatened, as its market share dwindles and competitors gain ground.
According to Seoul-based web and data analysis firm Internet Trend, Naver’s market share dropped to 55.2% at the end of March, marking one of its lowest levels in recent years, compared to 64.8% at the end of 2022. In contrast, Google claimed the second position with a 35.3% market share, a significant increase from 26.8% just three months earlier. The gap between the top player and the runner-up narrowed to 19.9 percentage points, down from a considerable 38 percentage points.
Microsoft’s Bing experienced a doubling of its Korean search engine market share to 3% during the same period. Notably, Bing’s daily active users on mobile apps skyrocketed sevenfold to 5,274 in March, according to Internet Trend.
Acknowledging the intensifying competition, a Naver official stated, “Google and Microsoft, along with AI chatbots from various tech companies, are vying for dominance in the Korean and global search engine markets. We are taking this challenge seriously. With the emergence of ChatGPT, Google also feels threatened.”
GOOGLE BARD VS MICROSOFT BING
Globally, Google remains the unrivaled leader in the search engine industry, commanding a staggering 93.2% market share as of March, as reported by research firm StatCounter. In contrast, Microsoft’s Bing accounts for a mere 2.9%.
In the realm of mobile search engines, Google dominates with a commanding 96.6% market share, while Bing lags far behind at a modest 0.5%.
As tech companies increasingly venture into conversational search engine services, Google introduced its own chatbot called Bard in February. However, Google received a surprise in March when it discovered that Samsung Electronics Co., the world’s largest smartphone manufacturer, was contemplating replacing Google with Microsoft’s Bing as the default search engine on its Galaxy mobile phones. Industry watchers suggest that Samsung aims to leverage an enhanced Bing service equipped with the artificial intelligence chatbot ChatGPT.
Samsung has relied on Google as its default engine since 2010, when it launched its first Android smartphone. While media reports indicate that Google is developing a new search engine with AI technology under the project name Magi, the company has yet to implement Bard into its search engine.
NAVER, KAKAO COUNTERATTACK STRATEGIES
Recognizing the evolving search behaviors influenced by platforms like Instagram, YouTube, and TikTok, particularly among the younger generation, Naver is diligently working on a conversational search engine powered by generative AI technology.
A recent survey conducted by Korean data research firm Open Survey revealed that 85.4% of teenagers cited YouTube as their most frequently used platform for search queries in the past week.
Naver announced its plans to unveil a beta version of its AI-powered search engine, SearchGPT, by the end of June. However, the launch has been postponed to the second half of the year. Additionally, industry sources revealed that Naver has partnered with Samsung to develop a generative AI platform targeting corporate users, enabling it to compete with ChatGPT and similar solutions.
In a parallel move, Naver Cloud, the AI unit of Naver Corp., is set to launch an upgraded version of its hyper-scale AI platform, HyperCLOVA X, in July. This advanced platform aims to create an AI ecosystem tailored specifically to Korean services.
Meanwhile, Kakao Corp., South Korea’s mobile platform giant, recently spun off its online portal operator Daum as an independent company within Kakao, seeking a change in its business model. Kakao also plans to introduce a generative AI chatbot for corporate users by the end of this year, further solidifying its position in the evolving market landscape.