By Se Young Lee and Sohee Kim
SEOUL (Reuters) - South Korea is trying to ease worries about online privacy after a domestic chat app lost customers to a foreign rival because of fears prosecutors in one the world's most wired countries might get access to online conversations.
Prosecutors last month launched a cyber investigation team after President Park Geun-hye spoke out against online rumors that she said "crossed the line" and were deepening divisions in society.
But that has sown confusion and fear of snooping among users and providers of online services.
On Thursday, Prime Minister Chung Hong-won tried to reassure the public about online privacy, saying the government would only seek monitoring rights in special circumstances, such an investigation of murder, human trafficking or insurrection.
"(He) emphasized that the government has been steadfast in ensuring freedom of expression and other basic privacy rights and will continue to do so," Chung's office said in a statement.
Authorities insist they have no intention or ability to conduct large-scale surveillance of the public but South Korean messaging app KakaoTalk said it had lost users because of the fears about surveillance.
A rival German app, Telegram, which does not have servers in South Korea, added more than two million Korean users in the two weeks through to Oct. 11, according to market researcher Rankey.com.
Telegram rushed out a Korean-language version in response to the surge in business.
"The defection to a foreign app reflects hostility towards the government," said Sohn Dong-young, a media professor at Hanyang University.
Daum Communications Corp, KakaoTalk's operator, said on Monday it had stopped complying with monitoring warrants since Oct. 7 to protect KakaoTalk user privacy.
It also shortened the time it keeps data on servers and would introduce privacy modes, making it nearly impossible for third parties to see user conversations, it said.
"We will conduct real-time monitoring if there is a public consensus to put that responsibility on operators," the MoneyToday news service quoted Daum co-chief executive Sirgoo Lee as saying at a parliamentary hearing on Thursday.
South Korea is a vibrant democracy but until 1987 it was an authoritarian state, with tight restrictions on freedom of expression and widespread surveillance.
That history makes South Koreans especially sensitive to any encroachment on freedom of speech, said Sung Dong-kyoo, a professor at Chung-Ang University's department of mass communication and journalism.
"We have rapidly transitioned from being a tightly controlled society, and react more sensitively about ensuring the protection of privacy," Sung said.
In a poll of 500 South Koreans released on Thursday by Realmeter, 43.5 percent said they agreed with Daum's stance not to comply with monitoring warrants because protection of private information was important, while 30 percent disagreed, saying it was an obstruction of justice.
(Editing by Tony Munroe and Robert Birsel)