NCSOFT Corp.’s headquarters in Seongnam, south of Seoul, is seen in this undated photo provided by the company.
SEOUL, Oct. 1 (Korea Bizwire) — South Korea’s video game powerhouses are eyeing new grounds, from K-pop to TV shows, in search for new audiences as they become increasingly outshined by a new generation of game companies.
Earlier this year, NCSOFT Corp., the creator of the hit fantasy series “Lineage,” launched a K-pop fan platform in an apparent move to enter the broader entertainment industry.
The mobile app, dubbed Universe, offers a string of interactive content, such as exclusive videos of K-pop stars, from Monsta X to Brave Girls, and even a short phone call feature with an artificial intelligence (AI)-generated voice of the artists.
The platform faces off with larger rival Weverse, operated by K-pop behemoth Hybe Co., the company behind global superstars BTS and backed by Netmarble Corp., another video game giant.
Netmarble has been a few steps ahead of NCSOFT, purchasing a major stake in Hybe in 2018, formerly called Big Hit Entertainment, to become its second largest shareholder.
The video game maker last year launched a BTS-themed mobile game, where users take on the role of the artists’ manager and nurture them to stardom.
Nexon Co., the creator of the popular massively multiplayer online role playing game (MMORPG) “MapleStory,” has also shifted gears, creating a film and television division earlier this year.
It hired former Disney and Activision Blizzard executive Nick van Dyk as its new Chief Strategy Officer to map out its global strategy and lead the new division, which aims to make productions based on Nexon’s game universe.
The recent moves from the video game giants, which have dominated the local market over the past two decades, come as new homegrown rivals have grown in presence.
In August, Krafton Inc. overtook NCSOFT to become the most valuable video game company on the local bourse after it went public.
The company’s successful initial public offering came on the back of its smash hit “PlayerUnknown’s Battlegrounds (PUBG),” which pioneered the battle royale genre in the global video game industry and has sold more than 75 million copies on PCs and consoles since its launch in 2017.
A scene from Krafton Inc.’s “PlayerUnknown’s Battlegrounds” is shown in this undated image provided by the company.
Meanwhile, rising star Pearl Abyss Corp. has also captured global gamers with its sandbox MMORPG “Black Desert,”, which launched back in 2014 and has since garnered 20 million users.
The company drummed up even more excitement from gamers in August when it unveiled its upcoming open world adventure game “DokeV” with impressive visuals.
In sharp contrast to the growing global spotlight enjoyed by new video game rivals, established heavyweights have long struggled to crack markets outside of East Asia.
Although Nexon and NCSOFT rank within the top 20 global video game companies by revenue, according to data analysis firm Newzoo, they heavily rely on East Asian markets.
More than 80 percent of Tokyo-listed Nexon’s revenue of nearly 300 billion yen (US$2.7 billion) last year came from South Korea and China, while 83 percent of NCSOFT’s revenue of 2.4 trillion won (US$2 billion) last year was from South Korea alone.
But even their strong grip over established markets has come under question this year.
In June, Kakao Games Corp.’s “Odin: Valhalla Rising” dethroned NCSOFT’s MMORPG “Lineage M” as the top grossing game on Google’s Play store in the country.
NCSOFT’s “Blade & Soul 2,” a sequel to its hit fantasy MMORPG, was panned by gamers at launch last month for disappointing graphics and its pay-to-win model.
Shares in NCSOFT have lost around 40 percent from the start of this year.
Nexon has also recently struggled to win the hearts of local gamers amid a lack of new original games.
It even found itself at the center of controversy earlier this year as some gamers accused the company of using unfair loot box systems in fan-favorite titles, such as “MapleStory” and “Mabinogi.”
The paid randomized rewards drew fire from gamers, even prompting protests outside its offices in Seongnam, south of Seoul.
This promotional image, provided by NCSOFT Corp., shows its new game “Blade & Soul 2.”
The company also faces growing risks in China in light of Beijing’s recent crackdown on online gaming.
“In a sense, the companies appear to see the limits of the industry (as is),” Wi Jong-hyun, a business professor at Chung-Ang University, said. “They could branch out to new industries on the back of technology used in their games, including AI and big data.”
The recent entertainment push appears to have made some progress so far — Universe had over 3 million monthly active users in June, with 80 percent of users outside of South Korea.
But the video game giants aren’t straying away from the core of their business.
NCSOFT is set to launch “Lineage W” later this year, the latest installment of its flagship franchise, with hopes to break away from its pay-to-play image and capture new gamers worldwide.
Nexon plans to release a string of new major titles, including a cross-platform shooter tentatively titled “Project Magnum” on top of its broader entertainment push.
New rivals, however, are closely behind in the industry shift.
Krafton has unveiled ambitions to target the broader media industry, with plans to create an animated series based on the PUBG universe by partnering with U.S. producer Adi Shankar, who was behind the popular Netflix series “Castlevania.”
“The media environment is rapidly changing,” Krafton Chairman Chang Byung-gyu said in a July media briefing. “The convergence and expansion of media and their transformation into various formats are what users ultimately want.”
(Yonhap)
