Crowd’s wisdom helps South Korean search engine beat Google and Yahoo from the New York Times describes South Korea’s most popular search engine, Naver.

Naver currently has a 77 percent share of all searches from within South Korea. Daum.net follows with 10.8 percent, Yahoo with just 4.4 percent and Google with a tiny 1.7 percent of Korean Web searches.

Why does Google fall short in South Korea? Wayne Lee, an analyst at Woori Investment and Securities, said “No matter how powerful Google’s search engine may be, it doesn’t have enough Korean-language data to trawl to satisfy South Korean customers.”

Naver’s founders realized that when searching in Korean, there was hardly anything to be found. So they set out to create the content and databases, so that when you would search in Korean, you would find quality content. Naver set up “Knowledge iN” in 2002, enabling Koreans to help each other in a type of real-time question-and-answer platform. On average, 44,000 questions are posted each day with about 110,000 returned answers.

The company is now the most profitable in South Korea and employs “27,000 workers, posted 299 billion won, or $325 million, in profit out of 573 billion won in sales last year. It has a market value of nearly 8 trillion won,” says the New York Times article.

Google and Yahoo are making efforts to catch up in this market. Google, for example, recently announced an answers service for Russia that could also come to South Korea (see Google Launches “Question and Answers” In Russia). Google also recently has tried to jazz up its Korean home page (see Google’s New ‘Animated’ Home Page In Korea).

Yahoo has renewed their partnership with Naver, Korea’s largest portal. Yahoo will continue to be, in a multi-year contract, the exclusive provider of sponsored search listings for search queries on the Naver portal and through Naver’s toolbar application. This news comes days after Daum dropped Yahoo for Google, Daum is Korea’s second largest portal.

Below is the full press release:

NAVER AND OVERTURE KOREA RENEW SEARCH MARKETING DISTRIBUTION PARTNERSHIP

SEOUL Korea, December 15, 2006 – Naver, Korea’s number one search portal and Overture Korea, a leading provider of search marketing products and services, announced today that they have renewed their strategic search marketing partnership. Overture will continue to be the provider of high-quality sponsored search listings in response to general search queries on Naver and queries from Naver’s toolbar application.

“Naver’s leadership position as Korea’s most visited online destination provides opportunities for our advertisers. We are proud to continue working with Naver to connect businesses and consumers at the point of search,” said Kim James Woo, Regional Vice President of Yahoo! Search Marketing in Asia and CEO of Overture Korea. “Our priority is to deliver high quality leads to our advertisers and relevant results to users, and this agreement enables us to drive those efforts even further.”

The deputy managing director of e-Biz from Naver, Min-Soo, Yeo said, “This re-contract gives us a great opportunity to reaffirm the mutual trust that we built together with an effort to develop domestic search ad market. NHN will continue to work closely with Overture to protect advertiser’s rights and interest and provide a valuable ad services to the Korean market.

Overture provides search marketing products and services to hundreds of thousands of businesses worldwide.

For more information about Naver, please visit: http://www.naver.com/. For more information about Overture Korea’s offerings, please visit: http://www.overture.co.kr/

About Naver

Naver(www.naver.com ), the search engine of NHN Corp is the number one search portal in Korea which has 16 million of daily visitors and its homepage features 850 million page views. Since its inception in June 1999, Naver has taken a leading role in developing Korea’s search services industry through the search engines invented by in-house technologies, such as Comprehensive Search, Knowledge Search and Book Text Search. Especially the Knowledge Search which started operating in October 2002 provides data base of knowledge based on experiences and senses of internet users. It is settled as the new paradigm of search service.