Pangyo Techno Valley in Seongnam, just south of Seoul, is an industrial complex being developed as South Korea’s version of Silicon Valley. (Yonhap)
SEOUL, Feb. 3 (Korea Bizwire) — South Korea’s video game industry is suffering from a delay in the development of new games, a deterioration of business performance resulting from lower than expected popularity of game titles, and the global economic slump.
Against this backdrop, layoffs are spreading, particularly among small and medium-sized game developers.
Wonder People Co., for instance, completed a voluntary retirement process that ended last month, leaving only game maintenance and repair staff.
NPIXEL Co. also entered an emergency management system after laying off some employees at the end of last year. The company has also reduced welfare benefits for its employees.
Devsisters Corp., the producer of the “Cookie Run” series, also decided to withdraw from the fan platform business and started layoff interviews with affected employees.
After aggressively expanding during the pandemic period, which led to a hike in payroll costs, small and medium-sized game developers are now hit by the boomerang effect.
“Another factor behind the spread of layoffs is the burst of the bubble in metaverse and blockchain games that emerged as a new industry during the pandemic period,” said Kim Jung-tae, a professor at the School of Game at Dongyang University.
J. S. Shin (js_shin@koreabizwire.com)
