Naver fined for own brand search engine rigging

Occurred: October 2020

South Korean internet giant Naver was fined 26.7 billion won (USD 23 million) for rigging its shopping and video services search engines in order to promote its own products and services. 

According to the country's Fair Trade Commission, Naver had deliberately and opaquely 'misled customers to believe the results were fair and objective,' and 'damaged fair competition in e-commerce and video platform markets.'

The FTC found Naver has manipulated its search algorithms six times between 2012 to 2015 so that its Smart Store, Naver TV and other services appeared at top of search results while pushing down competitors such as 11th Street and Gmarket. 

Naver's actions enabled to increase its online shopping market share from 5 percent in 2015 to 21% in 2018. Its four main competitors saw their market share drops over the same period, the FTC said.

It was the first time South Korea's FTC fined an online platform operator for manipulating its algorithms to damage competitors.

Operator: Naver
Developer: Naver
Country: S Korea
Sector: Technology; Retail
Purpose: Rank content/search results
Technology: Search engine algorithm
Issue: Competition/price fixing
Transparency: Governance; Black box; Marketing

Page info
Type: Incident
Published: April 2022