Kakao Corp., the operator of South Korea’s largest mobile messenger app, will spin off its artificial intelligence (AI) development lab into a separate entity, tentatively named KaEn, to enhance its business-to-business AI services as its next growth engine.

Kakao announced Sunday it is in the final stage of establishing separate entity KaEn on Dec. 1. About 400-500 developers at its current AI research & development lab, dubbed AI Lab, will move to the new company, with teams in charge of online workplace solution Agit business.

The demerged company will be led by current head of AI Lab Andrew Baek, formerly a B2B specialist at LG CNS.

Kakao has been actively applying AI technology in its various retail customer-focused services such as internet portal Daum, music streaming platform Melon and smart speaker Kakao Mini.

With the launch of KaEn, the company is expected to accelerate a plan to expand its presence in the B2B focused AI service market that is rapidly growing and groom the business targeting business clients to its new cash cow. The B2B AI market is easier to enter in Korea where rules and regulations for consumer-target AI service are much stricter.

The company has already offered its AI solutions to corporate names including GS E&C and Hyundai Motor, and with the launch of the new entity, it will accelerate its penetration in the market.

The demerger is the latest fruit of Kakao’s push to groom AI as its next growth engine. Brian Kim, chairman of its board, set up an AI research and development subsidiary Kakao Brain in 2017 and has been calling on the company to focus on the B2B business.

Kakao has been bolstering B2B services in its existing services including individual messenger platform Kakao Talk through the launch of in-app ads service Kakao Talk Biz Board (TalkBoard), e-mail link service Kakao Mail, and blockchain-based reward point system Kakao Con.

The services are part of efforts to integrate the user data from its added platforms such as Daum and Melon into that of the country’s largest messenger platform. The integration and management of big data will help advance the AI research and development, said industry experts.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]