The results of the Naver shopping and video sanctions announced by the Fair Trade Commission on the 6th revealed very concretely that Naver has been continuously manipulating search algorithms for its own benefit for a long time.
Unlike Naver's overwhelming share of the Internet portal, which has emphasized fairness through artificial intelligence (AI) and algorithms, it has been confirmed that it has artificially manipulated search results for its own benefit. It seems difficult to avoid a credibility hit.
According to the FTC, Naver has adjusted and changed the algorithm so that products of its open market service'Shop N'(currently Smart Store) launched in 2012 are first exposed in shopping search results.
There are 5 cases in large.
First, around April 2012, when Shop N was launched, a weight of less than 1 (0.975, etc.) was given to competitive open market products to lower the exposure ranking.
In addition, in July of the same year, the percentage of Shop N products exposed per shopping search page was set at 15%, and in December, this ratio was raised to 20%.
In January 2013, an additional weight of 1.5 times was given to the sales index applied to Shop N to increase the exposure.
In addition, when the same shopping mall products are exposed consecutively, the criteria for lowering the product exposure ranking of the shopping mall were introduced.Competitive open market products were regarded as the same shopping mall in units of open markets, but the products of Shop N were classified by tenant companies. .
In April 2015, two months before the launch of'Naver Pay', a simple payment service, at the request of an executive in charge of Naver Pay, the number of exposure limits for its open market products was eased from 8 to 10.
Not only shopping but also video search, the algorithm was completely reorganized, and it was revealed that it did not inform competitors and gave additional points to videos that entered the'Naver TV theme hall'.
This is contrary to Naver's principle that it does not distinguish between its own company and other companies' services in search services.
Naver said, "The Naver search service puts the most important value on providing information that is most suitable for various inquiries of users, and applies the same principle not only to Naver's own information, but also to information provided by affiliates and other businesses." .
The results of manipulating the search algorithms were immediate in performance.
Shop N's share of exposure by open market operators in Naver Shopping has more than doubled from 12.68% in March 2015 to 26.20% in March 2018, three years later.
In terms of transaction volume, it increased more than four times from 4.97% in 2015 to 21.08% in the first half of 2018.
In the case of videos, the number of Naver TV videos exposed to the top of the search results after a week of algorithm reorganization increased by 22%, and the increase rate of the number of impressions of the theme hall videos with additional points reached 43.1%.
WiseApp, an app analysis company, estimated that the payment amount for Naver in the first half of this year was KRW 12.5 trillion, nearly doubled from KRW 6.8 trillion two years ago.
Among these, the payment amount of the smart store was estimated to be the third place after Coupang and eBay Korea (auction and Gmarket combined).
Overseas, like Naver, they are already withdrawing from the act of giving preferential treatment to their own services by manipulating search algorithms.
In 2017, Google faced a fine of about 2.4 billion euros (3 trillion won) from the European Union (EU) for placing products on its shopping service above its competitors in product search results.