Kakao crash causes chaos to Koreans, from communication to catching cabs

Industry

Published: 17 Oct. 2022, 19:19

Kakao crash causes chaos to Koreans, from communication to catching cabs

People walk by Kakao Pangyo Agit, Kakao's headquarters in Seongnam, Gyeonggi, on Monday. [YONHAP]

The Kakao crash rendering numerous online services useless disrupted the daily lives of people in Korea as many are reliant on a broad range of its services, from messaging and payments to ride-hailing and music streaming.

About 83.6 percent of the Korean population, or 43.2 million people, were using KakaoTalk as of August, which serves as a primary communication channel in their work and private lives.

Kakao servers were knocked out as a result of a fire at a Pangyo, Gyeonggi, data center that started Saturday afternoon. The company's messenger and services offered by related companies were unavailable, degraded or intermittent anywhere from 10 hours to two days as backup systems failed to kick in fast enough.

In particular, commuters relying on Kakao T ride-hailing and map services had trouble getting taxis and finding routes following the disruption. People were stranded on the street as they tried to find a way to get back home.

“I tried to call a backup driver for my car after drinking in Gangnam after 9:30 p.m., but the app didn’t work at all,” said an office worker surnamed Kim, aged 30. “It was difficult to find other options, so I ended up paying more than usual for a taxi.”

Another office worker, aged 33 and also surnamed Kim, was using Kakao Navi, the navigation app, for directions while driving from Seoul's Gangnam District to Yongsan District when the app suddenly stopped working.

A Kakao user holds up a phone showing an error page as firefighters arrive on the scene of a fire that broke out at SK C&C in Pangyo, Gyeonggi, on Saturday. [NEWS1]

“I pulled off to the side of the road and installed another navigation app,” said Kim. “I was trying to contact the people I was meeting to tell them I was running late, but KakaoTalk didn’t work, so I had to call everyone one by one.”

Lee, 31, an office worker, found herself in a pickle when she had not downloaded the files she needed for work, sent to her through KakaoTalk, before the crash. She said she eventually got what she needed from another colleague.

Financial transactions were also affected as Kakao services crashed.

“I was trying to pay for the items in my cart around 7 p.m. yesterday when I found out the services were down,” said a university student surnamed Choi, 22. “I didn’t have my wallet with me because I was planning to pay through Kakao Pay.”

The monthly active users of Kakao Pay stand at 4.6 million, and 12.9 million for KakaoBank, as of the end of August, meaning the crash potentially affected a large portion of Korea's population.

Public services that rely on KakaoTalk also faced an emergency.

On Saturday, a notice was posted on the Ministry of the Interior and Safety’s app that notified people of their own services being halted due to the Kakao outage.

“Due to a failure in KakaoTalk including services for maps, locations and message sending and receiving, the report function of the safety reporting app, which operates in conjunction with Kakao, has stopped.”

Similarly, the “public secretary” service that informs people of daily administrative tasks operated by the Ministry of the Interior and Safety, which usually delivers information through KakaoTalk, announced on its website that notifications will be sent through another channel due to the Kakao outage.

The outage also affected cryptocurrency trading, since Upbit, the country’s largest cryptocurrency exchange, syncs with KakaoTalk for many users' login. As the login service through KakaoTalk stopped for nearly 20 hours, many users were unable to make transactions at desired times, and some are demanding compensation for losses.

Workers transport wire and other equipment for restoration work at the SK C&C data center in Pangyo, Gyeonggi, on Monday. [NEWS1]

Upbit had announced that it would adopt its own authentication and login system starting Oct. 31, and that its current login options, which use either KakaoTalk or Apple accounts, will be stopped on Nov. 21. Upbit is the only cryptocurrency exchange out of the five largest crypto exchanges in Korea to not have its own authentication and login system.

Transactions of cryptocurrency plummeted as users were unable to log on to Upbit . As of 3:30 p.m. Saturday, minutes before Kakao’s services went down, the daily trading amount of crypto was 1.34 trillion won ($932.4 million), according to cryptocurrency information site CoinGecko. At the same time the following day, the amount had fallen by more than half to 569.2 billion won.

Dunamu, the operator of Upbit, is currently discussing whether they will offer compensations, and, if so, how they will be offered.

Kakao Talk users are gathering together to sue Kakao for damages, with two online "cafe" forums on Naver open as of Monday for the purpose of bringing people together who wish to sue Kakao.

As users resorted to other messaging apps, sans Kakao, downloads of apps such as Line, Telegram and UT soared between Saturday and Sunday. Line is a messaging app owned by A Holdings, a joint venture owned 50:50 by Naver and SoftBank. UT is a navigation app owned 51 percent by Uber and 49 percent by Tmap Mobility, a spinoff of SK Telecom.

On Apple’s App Store, Line took the No. 1 spot for downloads, followed by UT. Similarly, Line and Telegram were the top two apps in terms of downloads in the communications category on Google Play Store, while T Map and UT climbed up to the top spots on the list for apps downloaded in the maps and navigation category.

“I had a group chat with my family on KakaoTalk, but since we couldn’t use it for hours, we moved everything to Line,” said a 30-year-old user surnamed Shin.

Saturday’s incident unmasked the problems of Kakao, which had been enjoying the scalability of its digital platform ranging from finance, payment, mobility, entertainment, shopping and games based on KakaoTalk. Most Kakao apps and related services are integrated into KakaoTalk, and the services' authentication system is built upon the messaging app.

While the authentication system is deployed by a number of Kakao apps, the task appears to be primarily handled by the Pangyo data center.

“It seems that there was a lack of preparation,” admitted Kakao co-CEO Hong Eun-taek in answer to a question by a member of the National Assembly’s Science, ICT, Broadcasting, and Communications Committee on Sunday. “The reason many services were affected is because the login and authentication were covered at the Pangyo Data Center.”

The technical failure, which started at the parent company Kakao, has to lead numerous problems in its subsidiaries. Whether or not KakaoTalk, the starting point of the business of more than 100 subsidiaries, has the appropriate technology and provides sufficient technical support to its subsidiaries is up for debate.

In the past five years, KakaoTalk has stopped for more than two hours a total of five times, including the fire on Saturday. Insiders of the IT industry evaluate these outages to be avoidable errors.

“If companies spend additional money on data duplication or traffic prediction technology, there would be a way to solve these problems to an extent,” said Kim Hyun-keol, president of the Korea Cyber Security Association.

Analysts further explained that the Kakao outage on Saturday was an event that exposed the dangers of a hyper-connected society where digital technology has advanced to the max.

“The Kakao incident confirmed that a hyper-connected society built on a digital platform can easily collapse,” said Yee Jae-yeol, a professor of sociology at Seoul National University.

“Since the KakaoTalk messenger has grown in public character enough to be used by the majority of people in Korea, there is a need for a system that allows the government to monitor and check Kakao so that it can operate normally in emergencies,” said Lee Won-jae, professor at the Graduate School of Culture Technology at Korea Advanced Institute of Science & Technology.

BY KIM NAM-YOUNG, SONG SEUNG-HWAN [lim.jeongwon@joongang.co.kr]