Dot-coms making fine comeback

Dot-com companies have been resurrected. According to performance reports by leading Internet companies in Korea, most of them posted positive results for the fiscal year 2002. Daum Communications Corp., founded in 1995 and the largest Web portal site, said yesterday that it generated a record 15.3 billion won ($13 million) in operating profits on 225.2 billion won in revenues in 2002. Compared with 2001, profits increased 59 percent while revenues grew 2.5 percent, the company said. NHN Corp., another Web portal company, said that the company saw 30 billion won in operating profits on 74 billion won in revenues in 2002. The firm's revenue tripled compared to that in 2001, while operating profits increased by six times. NHN also posted 21 billion won in net profit in 2002, seven times larger than the 2.9 billion won posted in 2001. Yahoo Korea Corp. recorded 13 billion won in operating profits, a 600 percent increase from the previous year's 1.9 billion won. The company estimates that its net profits will exceed 10 billion won. Neowiz Corp., a community portal, reported 8.6 billion won in net profits, while Empas, another Web community site, saw 5.2 billion won in operating profits. Industry analysts see another good year for market leaders in 2003. Leading companies are also expected to engage in fiercer competition, as audit standards changed to set commissions, not total sales, as the basis for revenues. Daum said it will enter the Internet job information market and will concentrate on games and entertainment businesses. "We will focus on diversifying profit bases," Lee Jae-woong, chief executive of Daum, said. In the past, the shopping mall business accounted for 70 percent of Daum's revenues, while advertising took up 20 percent and transaction services 10 percent. The company wants to increase the share of advertising to 60 percent of total revenues, Mr. Lee said. NHN plans to introduce a variety of forms of advertising in its Internet search services, and launch a new site that provides entertainment and movie services. "We plan to keep a stable growth in games and avatars this year," Stanley Park, president of Neowiz, said. "As in the United States, leading dot-com companies seem to have found profit bases," Kim Chang-gwon, an analyst at Kyobo Securities, said. by Choi Ji-young