A large South Korean internet company and operator of the messenger, spent part of their budget on blockchain and AI technology. Published financial reports of the corporations previous quarter during 2018, states that over $57 million expenses were related to blockchain, artificial intelligence, and other new technologies.
Additionally, the net profit of Kakao for this period was only $3.8 million. Meaning, the company’s interest for innovations cost it quite a lot and caused rather large losses. Even so, the vice-president of management strategy, Bae Jae-Hyun, assured that Kakao will continue to invest into DLT and other such emerging technologies.
The Korean internet giant launched its very own test blockchain dubbed Klaytin during October of last year. The development has a flexible consensus mechanism for confirming transactions, and the network capacity allow a total of 1500 payments per second. The main network is estimated to be ready to launch during the first half of this year.
Kakao has also invested into an Israeli-based startup named Orbs. It team is currently developing a “hybrid blockchain” compatible with the Ethereum network.
Kakao is a mobile lifestyle platform company with services that extend to messaging, mail, search, news, advertising, gaming, e-commerce, music, maps, and much more. This South Korea-based company reaches consumers, businesses, and others through services such as KaKaoTalk, KaKaoGame, Duam Mail and Daum Cafe, among its other programs.
This platform allows a connection for finances with technology for payment solutions that allow users to make payments with a few selected buttons and a 6 digit password or transfer cash to friends based on the Kakao Talk social network.
Bae Jae-Hyun had this to say during an earnings call:
“If we look at operating profits in a comprehensive manner, we have achieved a steep sales growth with a new profit model. In the fourth quarter, sales grew more than expected due to the peak season of the year, but overall operating profit fell sharply YoY due to operating expenses of W65bn due to investments in new businesses such as mobility, AI, and block chains. We will continue to grow our existing business and aggressively pursue new businesses to drive sales growth and improve our operating profit rapidly.”