[Edaily Reporter Kim Hyun-ah ] Restrictions on social media use by minors under the age of 16 are becoming a reality. With President Lee Jae-myung citing examples from other countries and calling for the establishment of such regulations, the likelihood of stringent social media regulations for minors being introduced in South Korea has increased.

Industry observers believe global platforms such as Instagram, TikTok, and YouTube will be most significantly affected. In contrast, Naver and Kakao are expected to face increased costs associated with building systems for age verification and parental authentication, rather than a decline in earnings due to a drop in users. Consequently, the markets for identity verification and AI-based age estimation are expected to see new growth opportunities.

Global Platforms

Take a “Direct Hit

”… Domestic Platforms to Build Verification Systems

The platforms set to be most affected are global social media services with high proportions of teenage users, such as Meta’s Instagram and Threads, TikTok, X, Snapchat, and YouTube. This is because a decline in teenage users leads to reduced ad exposure and time spent on the platform, which could directly impact revenue.

The model being considered by the government is likely to be similar to the Australian approach. Last year, Australia became the first country in the world to introduce a law that, in principle, prohibits minors under 16 from holding social media accounts, with the law set to take effect at the end of this year. The law imposes the obligation to verify age and block accounts belonging to minors on platform operators, rather than on users or parents.

The regulations apply to platforms such as Facebook, Instagram, Threads, TikTok, Snapchat, X, YouTube, Reddit, and Twitch, while Roblox, GitHub, and YouTube Kids are excluded.

Platforms must take “reasonable measures,” such as verifying age, deleting accounts belonging to minors, and preventing circumvented sign-ups. Violations will result in fines of up to 54.6 million Australian dollars (approximately 50 billion won).

On the other hand, Naver (NAVER(035420)) and Kakao(035720)are expected to see only a limited direct decline in revenue. This is because Naver relies heavily on search, shopping, and webtoons, while Kakao focuses on messaging, finance, and mobility.

However, services with community features—such as KakaoTalk Open Chat, KakaoStory, Naver Band, and Chijijik—are expected to incur significant costs as they must implement new systems for age verification, parental authentication, and youth account management.

“Beneficiaries” of the Identity Verification Market

Age restrictions on social media are expected to present new opportunities for the domestic identity verification and security industries. As platforms must verify users’ ages quickly and accurately, demand for AI-based age estimation and digital identity verification technologies is expected to increase significantly.

In particular, authentication technologies that verify only adult status while minimizing the use of personal information are emerging as key solutions. Companies such as ATON Inc.(158430), which provides mobile authentication based on the three major telecom carriers, and RaonSecure Co., Ltd.(042510) and Dream Security Co.,Ltd.(203650), which possess DID (Decentralized Identity) technology, are cited as leading beneficiaries.

AI facial recognition technology that estimates age using only facial images—without the need for identification documents—is also gaining attention. AI-based harmful content detection and moderation technologies owned by Alchera Inc.(347860), as well as Naver and Kakao, are also expected to drive expansion in the business-to-business (B2B) market.

The key issue is effectiveness… Australia also faces the challenge of circumvention methods

President Lee Jae-myung expressed his determination to introduce social media regulations for minors during the Korea Communications Commission’s briefing on the 16th, stating, “Let’s discuss restricting social media access for those under 16,” and even conducting an impromptu vote on the matter.

However, to avoid repeating the controversy over effectiveness seen with the past “game shutdown system,” the government is considering phased regulations. Taking into account limitations such as enforcement power over overseas platforms and circumvention via VPNs (virtual private networks), the government appears to be placing more emphasis on age-specific, tailored regulations rather than a blanket ban.

Kim Jong-cheol, Chairman of the Korea Communications Commission, stated, “We will not repeat the mistakes of the gaming shutdown system,” adding, “We are reviewing restrictions on social media sign-ups for those under 14, and discussing plans to gradually limit features that encourage excessive engagement—such as recommendation algorithms and infinite scroll—for those aged 14 to 19.” He continued, “Rather than uniformly blocking sign-ups altogether, we will move forward by establishing age-based safeguards.”

Both within and outside the government, an approach similar to Australia’s—where platform operators, rather than users, are required to verify age and block accounts belonging to minors—is being cited as a leading alternative for a domestic regulatory model.