Will the massive amount of data owned by LY Corporation trigger an antitrust review by the Japan Fair Trade Commission (JFTC)?

LINE YahooLY CorporationAntitrustData GovernanceMarket DominanceJFTCBig Data
Created At: 8/15/2025Updated At: 8/17/2025
Answer (1)

Hello, this question hits the nail on the head, and it's something many people are focusing on. As a long-time observer of tech companies and market dynamics, let me break down my thoughts for you.

Simply put, the answer is: Highly probable, and the Japan Fair Trade Commission (JFTC) already has LY Corporation under a microscope.

But this doesn't necessarily mean penalties are imminent; the situation is more complex than that. Let me unpack this for you.

1. First, how “frightening” is LY Corporation's data volume?

Imagine the two "super apps" in your daily life suddenly becoming one company:

  • LINE: Used by virtually everyone in Japan, like "WeChat." Your social connections, chat history, interest groups, stickers used, even payment habits (LINE Pay) are all here.
  • Yahoo! Japan: Japan’s largest portal and its second-largest search engine. It knows what you search for, what news you read, what you buy (Yahoo Shopping, PayPay), and what you auction (Yahoo Auctions).

Now, these two have merged into LY Corporation. This means, theoretically, the company can perfectly piece together "your social self" and "your consumer/information-seeking self," forming an incredibly clear, multi-dimensional user profile.

The value of this profile for advertising, product recommendations, and developing new services is absolutely game-changing.

2. What exactly is the Fair Trade Commission (JFTC) worried about?

The JFTC acts like the market referee. A ref doesn't penalize a player just for being big and strong, but they watch closely for any fouls exploiting that physical advantage.

For LY Corporation, the JFTC is primarily concerned about these potential "fouls":

Minefield 1: Data Exclusivity, Blocking Competitors

  • Scenario: A new startup wants to create a personalized news app. It needs user data for recommendations, but it can't compete with LY. Holding LINE's social preferences and Yahoo's news browsing history, LY can easily offer "the news service that knows you best," leaving the new company no chance.
  • The Referee's (JFTC) Concern: This is classic "leveraging data superiority to create barriers to entry." When no one else can compete, the market stagnates, ultimately harming consumers (through reduced choice and stifled innovation).

Minefield 2: Unfair "Bundling"

  • Scenario: LY might introduce a policy like: "Hey user! If you agree to let us use your LINE chat data to improve Yahoo Shopping recommendations, you get exclusive discounts on Yahoo Shopping."
  • The Referee's (JFTC) Concern: This puts users in a bind. While seemingly offering a benefit, it essentially forces them to hand over more private data. Those who refuse are treated unfairly. This is also highly unfair to other e-commerce platforms.

Minefield 3: Leveraging Dominance to Suppress Rivals

  • Scenario: For example, prioritizing display of its own or partner services (like PayPay payments, Yahoo Travel) in Yahoo search results or LINE news feeds, pushing competitor services further down.
  • The Referee's (JFTC) Concern: This is an abuse of market dominance. Being both the "athlete" (service provider) and the "field manager" (controlling the information gateway) creates an unfair playing field.

3. How might LY Corporation "Defend" itself?

Of course, LY Corporation won't just stand idly by. They will certainly argue:

  1. "It's for the user's benefit!": Data integration enables more convenient, personalized services, like using a single account across all platforms and getting recommendations for things you truly need.
  2. "We're competing with global giants!": Our real competitors are global juggernauts like Google, Meta (Facebook), and Amazon. Without consolidating our data and resources, Japanese companies simply cannot compete.
  3. "We have strict data governance!": We will establish an independent oversight committee to ensure data usage is compliant, transparent, and conducted with user consent.

Conclusion: So, will there be regulatory scrutiny?

My assessment is:

Scrutiny is inevitable, but its specific form and outcome are uncertain. When the JFTC approved the LINE and Yahoo Japan merger, it imposed conditions requiring them to regularly report on data usage. This act itself constitutes a form of "preventative scrutiny."

The recent "LINE data leak" incident is fueling the flames. While primarily a data security issue, it also exposed vulnerabilities in LY Corporation’s data governance, significantly heightening the JFTC's vigilance regarding its potential data monopoly concerns.

Therefore, you can understand it this way:

  • The JFTC's "microscope" is firmly in place, trained on LY Corporation's every move.
  • Whether a formal antitrust investigation is launched depends on what LY Corporation does next, not just what it has.
  • If it engages in the behaviors mentioned above, like forcing user data sharing or suppressing competitors, the JFTC will undoubtedly act decisively.

In short, LY Corporation is like a giant walking a tightrope – wielding immense power, but it must tread extremely carefully. Below lies a precipice, and the market's "referee" is watching its every step unblinkingly.

Created At: 08-15 06:00:42Updated At: 08-15 10:30:28