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    Kakao founder considers sweeping compensation for service blackout

    ANN/THE KOREA HERALD – Founder of South Korean online platform behemoth Kakao Kim Beom-su said yesterday that he will consider providing across-the-board compensation for users who suffered damages due to the company’s unprecedented service malfunction caused by a fire at an SK C&C data centre on October 15.

    “We are currently accepting damage reports from the users, so it is difficult to specifically tell the type and size of our compensation. We are reviewing all measures to help (users) recover,” Kim said during a state audit for the Science, ICT, Broadcasting and Communications Committee at the National Assembly.

    The lawmakers stressed that Kakao should pay compensation to all users, including those who failed to access free services including KakaoTalk, the IT firm’s immensely popular messenger app utilised by over 90 per cent of the entire population.

    Since the incident, Kakao has so far come up with compensation measures for those who use paid services such as music streaming platform Melon, Kakao’s web comics and Kakao T’s premium taxi-hailing option, according to the company’s terms and conditions.

    Asked about public concerns that reparations may be delayed as Kakao and SK C&C seem to be gearing up for a legal dispute over the responsibility of the damage compensation, Kim vowed to take all necessary measures to reimburse affected users as soon as possible, regardless of a lawsuit.

    Kim, however, made it clear that he will not return to a management position at Kakao, adding that Kakao and its subsidiaries have been led by professional leaders for a while now.

    Kakao founder Kim Beom-su apologises for the company’s service malfunction caused by a fire at SK C&C’s data centre building during the National Assembly’s state audit yesterday. PHOTO: YONHAP

    SK C&C CEO Park Sung-ha, who was also summoned by the committee, echoed Kim’s opinion of prioritising compensation for the public. “We will proactively participate in discussions about compensation even before the cause of the incident is clarified. The talks will be held not only at (SK C&C), but also at (the highest levels of SK Group),” said Park.

    In addition to Kim and Park, the committee summoned SK Group Chairman Chey Tae-won, Kakao CEO Hong Eun-taek, Naver co-founder and current global investment officer Lee Hae-jin, Naver CEO Choi Soo-yeon and Minister of Science and ICT Lee Jong-ho.

    Chey, however, did not show up to the audit but said he would appear in the evening as Representative Jung Chung-rae of the main opposition Democratic Party of Korea, chair of the science committee, denounced Chey’s absence in the afternoon.

    Earlier, Chey cited attending a forum on the same day and preparing for an upcoming presentation as part of Busan’s bid to host the World Expo in 2030 as the reason for his absence.

    Naver’s Lee apologised for the company’s service malfunction, adding that there were inconveniences to users despite the employees responding properly according to the crisis management manual. Earlier in the day, the Korea Driver Service Society and three other groups estimated the average loss for paid designated drivers at KRW178,000 (USD123) from Kakao’s driver-calling service outage.

    “Compensation for (paid designated drivers) who use free services, which are not stipulated in the terms and conditions, is far from being carried out,” the groups said in a press conference held in front of the National Assembly.

    According to the groups, over 90 per cent of the 382 paid designated drivers who filed damage reports could not receive driver-hailing calls while Kakao’s servers were down.

    The groups said they would not accept Kakao’s compensation of KRW4,260 – equivalent to six days of the paid service – to those who use the premium membership.

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