What roles do parent companies SoftBank and Naver play in the future development of LY Corporation? Are there potential conflicts in their strategic intentions?

LINE YahooLY CorporationSoftBankNaverCorporate StrategyJoint Venture
Created At: 8/15/2025Updated At: 8/17/2025
Answer (1)

Sure, here is the translation:

Okay, no problem. Let's keep it conversational and get this explanation clear for you.

Imagine LY Corporation (the new company formed from the merger of LINE and Yahoo Japan) as a newly formed family, with SoftBank and Naver as the two "head parents," each holding an equal 50% share and equal power.

Now, let’s look at what each "parent" is thinking and why they might "argue."

The Two "Parents": What Roles Do SoftBank and Naver Want to Play?

SoftBank (SoftBank): The Local Powerhouse Aiming to be "Japan's Overseer"

  • Its Role: Market strategist and resource integrator.
  • Its Core Idea: SoftBank’s goal is crystal clear: to build an all-encompassing "super empire" within Japan. Think about it: SoftBank has Japan's largest search engine and portal (Yahoo Japan) and Japan's most widespread mobile payment service (PayPay). Now, it’s brought in LINE, the national-level messaging app.
  • What it Wants to Do: Its strategy is "close the door and become the king of Japan." Bundling together Yahoo's e-commerce and news, PayPay's payments, and LINE's social features. You chat on LINE, easily pay with PayPay, and check news on Yahoo Shopping—all within one seamless loop. The aim is to make Japanese users inseparable from its service ecosystem. For SoftBank, LY Corporation is the final and most crucial piece for dominating the Japanese market.

Naver: The Korean Tech Giant with Global Ambitions

  • Its Role: Core technology provider and globalization driver.
  • Its Core Idea: Naver is Korea's Google, with formidable technological prowess. LINE was essentially its own "child," its most successful international product. Naturally, Naver wants this "child" to continue shining globally.
  • What it Wants to Do: Naver’s plan is to use LY Corporation to, on one hand, maintain its influence in Japan and Southeast Asian markets (like Thailand and Taiwan) where LINE is strong. More importantly, though, it wants to sell its own cutting-edge technologies, such as AI and cloud computing, to LY Corporation. This way, it gains dividends from LY's operations and collects tech service fees, while expanding its technological footprint globally. For Naver, LY Corporation is a strategic outpost to showcase its tech strength and achieve technology expansion.

Conflict in "Parenting Philosophy": Is There a Clash in Their Strategic Intentions?

The answer: Not only does it exist, but it’s already out in the open.

It's like two parents having a major disagreement about the child's future.

1. The Control Battle: "Who Calls the Shots?"

  • Point of Contention: It started as a 50:50 even partnership. But recently, the Japanese government, citing "data security" concerns, demanded that LY Corporation strengthen its governance and suggested SoftBank increase its shareholding. The implication was clear: they want Naver to reduce its stake and hand over dominance to the Japanese side.
  • Simply Put: The Japanese side thinks: "We can't trust a Korean company (Naver) holding communication data for hundreds of millions of our citizens, with its technical backend hosted in South Korea." SoftBank is keen to leverage this sentiment to gain more control. Naver, naturally, resists: why should it surrender control of the "child" it nurtured to prosperity?

2. The Technology Line Battle: "Whose Tools Do We Use?"

  • Point of Contention: LINE's core systems and technology have long been provided and maintained by Naver. Now, LY Corporation faces a choice: continue relying on Naver's tech (meaning ongoing "tech service fees") or invest heavily to build a new "local Japanese" tech system?
  • Simply Put: SoftBank and the Japanese government lean towards the latter, also citing "data security" and "technological independence." Naver wants to continue providing technology, as it's both a crucial revenue stream and key to maintaining influence. Cutting off this tech dependency directly weakens Naver's voice within LY Corp.

3. The Market Focus Battle: "Domestic Priority or Global Outlook?"

  • Point of Contention: SoftBank's strategic focus is "deepening its presence in Japan," concentrating all resources to build the "super empire" mentioned earlier. Naver, however, wants LY Corporation to continue targeting global markets, especially investing in regions like Thailand and Taiwan where LINE is dominant.
  • Simply Put: If SoftBank's "Japan First" strategy becomes the sole priority, LINE's overseas businesses might be sidelined, receiving insufficient resources. This completely contradicts Naver's original goal of using LINE for global expansion.

To Summarize

  • SoftBank plays the role of the market dominator, aiming to use LY Corporation to consolidate Japanese domestic resources and build a closed, yet powerful, local ecosystem. Its gaze is inward.
  • Naver plays the role of the technology enabler, wanting to use LY Corporation to export its advanced technology and maintain its influence in global markets (especially Asia). Its gaze is outward.

Their core conflict stems from this strategic divergence of "inward" vs. "outward" focus, concentrated in the key issues of control, technological dependency, and market direction. Currently, with the Japanese government's intervention, the scales seem to be tipping towards SoftBank. Naver faces a very difficult choice: concede some power to preserve the partnership, or pursue its own strategy at the risk of escalating tensions. The future of the LY Corporation "family" hinges on how these two "head parents" ultimately play their game.

Created At: 08-15 05:55:35Updated At: 08-15 10:24:29