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| A person enters Kakao's office in Seongnam, Gyeonggi Province, Monday. Yonhap |
By Lee Min-hyung
The Financial Supervisory Service (FSS) is looking into whether Kakao's financial affiliates took timely countermeasures after a fire broke out at a data center on Saturday.
According to the financial authority, it demanded KakaoBank, Kakao Pay and Kakaopay Securities submit their real-time response actions for the weekend.
The inspection came in reaction to growing public complaints over hours-long service disruptions of the financial services run by the mobile platform operator.
Most of the services became available again on Sunday, but the authority decided to launch the inspection to clarify the root causes behind the belated normalization of the services and find out who to hold responsible for the system error.
If the financial watchdog finds evidence of any mishandling of emergency response actions by the companies, chances are it will expand the scale of its inspection.
Kakao shares plummeted on the first trading day after the incident, Monday. The company closed at 48,350 won per share, down 5.93 percent from the previous trading day. Shares of KakaoBank and Kakao Pay also plunged with similar drops of 5.14 percent 4.16 percent, respectively, during the same period, according to data from the Korea Exchange.
Other companies affected by the fire also experienced similar losses. SK shares closed at 198,500 won, down 3.64 percent. SK is the holding firm of SK C&C which is responsible for the management of the data center in Pangyo in Seongnam, Gyeonggi Province, where Kakao operates about 32,000 servers for its mobile services.
Meanwhile, some other stocks benefited from the incident. NHN, which operates two data centers stably in Gyeonggi Province, closed with a gain of 5.58 percent on the same day based on a reflection effect.
Securities firms estimate Kakao lost around 22 billion won ($15.3 million) due to the recent fiasco.
"KakaoTalk's messaging service was suspended for about 10 hours from Saturday afternoon, but its ad sales on Bizboard displayed on top of users' chat rooms were not available even throughout Sunday," Samsung Securities analyst Oh Dong-hwan said. "Kakao also failed to generate sales in its mobility and gift services during that period. The company is feared to suffer sales falls of up to 2 percent during the fourth quarter."
Kakao is also widely expected to suffer additional hits to its brand image following the longest-ever service outage in its history.
A group of Kakao users are also planning to take a class action against the company, seeking compensation for the service error. Even if Kakao has yet to share its plans for compensation to its users who suffered financial losses over the weekend, chances are that subscribers of its charged services will be able to seek compensation once they prove their losses.
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