KoreaCrunch

NHN announced it had bought out local search engine company 1noon for 35 billion won (36.5 million dollars). It was great news on korean IT business in yesterday. There was no acquisition examples in this scale after dot-com booming.

NHN operates the Internet portal site Naver, the most frequently-visited portal site in Korea with daily hits averaging 16 million and holding 70 percent of the online search engine market in advertising revenue. 1noon ― pronounced “cheotnun” meaning “first snow” ― was spun off from game developer Neowiz in May last year with an initial capital of 1 billion won. For the past few months, the small company has offered test services of a search engine based on a self-developed technology that enables searches based on themes instead of keywords. Chang Byung-gyu, joint founder of Neowiz, and president of 1noon, claimed the new technology would be the “Korean version” of Google.

The takeover was viewed by many in the local industry as an attempt to fend off attempts by global search giant Google to buy into the local market. Google headquarters was not available yesterday for comment. The company does not have a local office, but according to a local agent, Google officials met with Mr. Chang but did not reach a “detailed” agreement. The global Internet firm has already signed an advertising distribution contract with the local Internet firm Empas and is conducting interviews for a Korean branch head.

NHN’s chief executive Chae Hwi-young said his company hopes the acquisition of 1noon will help pave the way for its entry into foreign search service markets. Mr. Chang will continue to develop the search engine specifically for NHN.

But, some of bloggers expressed their regret to lose an ambitious venture enterprise after this announcement. Because Mr. Jang has told his dream on global search market in his blog, but he sold out this company before the end of beta service. I think it will be very successful decision both 1noon and NHN.