New tech, new war: Naver, Kakao race for AI dominance

With digital technology becoming the key drivers for growth across industries, South Korea’s tech behemoths Naver and Kakao are going all-in to win the tech war using artificial intelligence through AI-powered search engines and logistics solutions businesses.

Naver announced Tuesday it has made upgrades to its AI search engine, called “Airsearch,” now offering more optimized search results for users.

“Since the Naver mobile app has access to users’ personal information ranging from gender, age and other specifics, AI offers more detailed content and finds useful content that users weren’t even looking for in the first place,” a Naver official said.

For instance, if a female in her 30s clicks on “how to decorate a room,” the search engine recommends more detailed search terms such as “how to improve the mood of my room,” rather than offering a vast amount of data or room decor tips, the official added.

The search suggestions program, dubbed “Smart Bloc,” is based on AI machine learning of the most frequently-typed words from users in a specific demographic or with specific preferences.

Airsearch has also adopted a multi-modal AI model that simultaneously searches text and images, moving beyond text-based internet searches. If users want to look up a pair of sneakers, they can search Naver with an image and add more keywords to narrow down the search.

Kakao Brain, the AI technology research and development subsidiary of Kakao, has recently launched the upgraded version of its image-generating AI model, called “RQ-Transformer.”

When users type in requests such as “draw a picture in a Salvador Dali style,” the AI model presents such images.

RQ-Transformer is capable of machine learning twice as much datasets compared to the previous model, according to the company.

“The new AI model is meaningful because it was developed by the company’s unique technology, unlike the previous version that was more about replicating the AI model of OpenAI, a US-based AI tech firm,” the company added.

The two tech giants are also jumping into the AI-powered logistics business.

Kakao Enterprise, the AI solutions provider arm of Kakao, has officially launched Kakao Logistics as a Service, called “i LaaS.” The new platform offers more digitalized logistics process services including sales and inventory checks using AI.

“E-commerce platforms and shipping companies can provide a faster and more efficient delivery, while warehouse owners can utilize the storage space to the fullest extent,” a Kakao Enterprise official said.

Although the logistics industry has been under the spotlight due to fast-growing e-commerce, there were still problems of warehouse vacancies. But i LaaS can lower the vacancy rate and increase revenues for business owners, the official added.

Last year, Naver launched the “Naver Fulfillment Alliance,” a platform that services data such as logistics analytics and demand forecasting for e-commerce business owners.

In order to gain a competitive edge, Naver has joined hands with logistics and fulfillment companies -- CJ Logistics, We Keep, OurBox, Poomgo and Fasto. In February, the company added Mesh Korea and Techtaka, tech-based logistics startups, to its partnership alliance.

By Byun Hye-jin (hyejin2@heraldcorp.com)