The reason is that while the owners of internet portals based on communications businesses, such as HanaFOS.com and Nate.com, have all put forth the goal of entering the top three this year, their primary target is Yahoo! Korea.

It seems that Yahoo! Korea, which last year gave up its position as the number two portal to the rapidly growing NHN, is now facing threats to its number three spot.

To confront this threat, Yahoo! Korea's strategy is to maintain its leading position through aggressive business development.

Yahoo! Korea's President Sung Il Lee stated confidently that, "ignoring the threat from these latecomers, this year we will encourage aggressive investment and marketing," and that, "you will see a different Yahoo! Korea from the one you have known up to now."

Yahoo! Korea has undertaken as this year's management goal to double sales even while maintaining a rate of return similar to last year's level.

Last year, Yahoo! Korea netted 16 billion won and its rate of return was about 30%.

President Sung Il Lee revealed that, "Yahoo!, together with the main office's efforts at earnings diversification, will be coming out with a variety of new experiments domestically this year."

In contrast to the last few years, the plan is to develop the sale of merchandise in parallel to normal business efforts.

Among them, Yahoo! Korea will place the greatest emphasis on the two areas of searching and community.

Searching is the area that Yahoo! Korea considers to be its main strength.

However, in the meantime it has lost its lead to the competition due to negligence.

Searching came up as the main source of revenue for portal sites last year, and its primacy is growing much more.

At search portals like Naver and Empas, the weight given to search advertising sales has increased.

Yahoo! Korea too has set a goal to more than double its sales compared to last year by strengthening its search division even more.

"Advertising space will not be artificially increased for the sake of raising search advertising sales," said President Sung Il Lee.  "Instead, search functions and quality will be improved and business development will be directed at raising the degree of satisfaction."

For this purpose, the number of people on the latest search surfing team has even been increased by about five times.

Besides that they will also begin offering community services, a business that has been longer-cherished between the two.

"We plan to foster communities flavored with clubs and chatting, games, and avatars in Korea, which will be a first among all Yahoo! services worldwide."

He explained that their planned community is generating a lot of interest in Europe and the Americas as well.

The strategy is to gradually reduce the relative importance of advertising sales, which had been the majority of all sales before, through the diversification of all these businesses together.

Already, that which had comprised 80% of all sales in 2001 has diminished to 60% in 2002.

The relative importance of advertising sales may diminish, but they are expecting that actual sales will greatly increase.

President Lee said, "this year we expect advertising sales to increase by about 40% compared to last year due to an increase in the online advertising market."

"Rather than raising the advertising unit cost, we are developing advertising products so as to better utilize online advertising with marketing and research tools.  In accordance with this we have just reshuffled the advertising sales organization chart," he added.

Yahoo! Korea has even just formed a new wireless internet task force.

This is in preparation for the introduction of a wireless internet network.

Currently 14 contents are being offered on a wireless internet.

There are plans for a download service that can connect with real sales on wireless internet TFT, and to research policy in preparation for future IMT-2000 service.

/ Hui Jong Kang reporting [email protected]