The gaming industry in Korea will continue to be strong in 2024. South Korea is seen around the world as one of the top gaming countries. It is currently the world’s 4th largest market for video games. It is also considered the Esports capital of the world and it makes sense. South Korea is known for its passion for technology which gives every citizen access to high-speed internet. With the rise in IT infrastructure in Korea, there was the same level of rise in the gaming market in Korea. Soon internet cafes and PC rooms started to spring up all across Korea. These centers played a critical role in gaming companies in Korea like Nexon and NC Soft to develop competitive online/PC games due to the increase in demand.
So what makes South Korea such a powerhouse when it comes to the gaming industry? To fully understand the gaming industry in Korea, here is a complete breakdown of not just the industry but the shift in trends over the years and how Korea has been able to adapt and thrive.
Gaming Companies in South Korea
Korean gaming companies have become very successful since the coronavirus pandemic. In addition, while they have found great success creating games for the Korean market, lately they have focused on the global market. China has been an avid consumer of Korean games. Moreover, gaming companies in Korea have been able to adapt and transition with the shift in the digital landscape. A clear example has been with Nexon which has done a great job of refurbishing old successful Korean PC games like KartRider and Maple Story into successful mobile games. The same goes with NCSoft, a gaming company in Korea that has found great success in their MMORPG game Lineage which they were able to successfully take to mobile. Lineage has become the blood of NCSoft as it takes up more than 85% of its total revenue.
Therefore, many gaming companies in Korea are looking for the next “big game” and are also looking into other sectors such as the Metaverse, AI, Blockchain, VR, and even trading in order to be flexible in case of a gaming shift.
The Online Video Game Market in Korea
Once the video console game industry started to see the rise of online platforms, they also saw a rise in the popularity of online games in South Korea. This was because the South Korean government invested heavily in the IT industry which caused the price of personal computers to go down. Add this to the development of high-speed internet lines and you have millions of Koreans eager to get into online gaming. Soon PC bangs and internet cafes started to spring up all over Korea. Most of the PC bangs were making money because the cost of computers was lower than ever before and games like Starcraft and Lineage were more fun to play when played together under one roof.
Online video gaming was perfect for the types of games that Koreans love. One genre in particular called the massively multiplayer online role-playing games (MMORPGs) has been fully embraced by Korean gamers. One of the most popular MMORPG games in Korea is Lineage. Since 1998, Lineage has been a staple of the South Korean gaming industry. It has spawned sequels in both PC and mobile and has generated over $4.5 billion in sales to date.
These days, gamers in Korea are exploring other genres besides MMORPGs like first-person shooter games and multiplayer online battle arenas (MOBAs).
Mobile Gaming Industry in Korea
South Korea is the world’s largest producer of mobile games which have a production cost of over $1 million. The size of the Korean mobile gaming market is smaller compared to China and the United States. However, the spending per person on games is much higher in South Korea. It all started with the free-to-play model games that were a huge success in South Korea. They proved that this model can generate revenue and once it was perfected in the Korean market, global mobile gaming companies followed suit. These days, Korean mobile games have some of the best graphics and a diversity of genres in the world. With the advancement of technology, MMORPGs can now be played via mobile. This is why MMORPGs hold a greater market share among users and revenue in the Korean mobile video game market.
One of the most successful mobile games in Korea is Lineage II: Revolution released by…Netmarble. That is right, Netmarble released Lineage II: Revolution. NCSoft the original creators of Lineage were still able to get royalties from Lineage II: Revolution. NCSoft owns 6.9% of Netmarble and formed a licensing agreement with Netmarble which allowed them to make the game. It broke a record in the mobile gaming industry in Korea by generating the most money in the first 30 days of launch. Based on the success of Lineage II: Revolution, Netmarble was able to have a successful IPO and is valued at $12 billion. Don’t feel too bad for NCSoft. In 2017, NCSoft’s Lineage M broke all of Lineage II’s records.
The Esports Capital of the World
South Korea has done Esports the right way. They have revolutionized the industry by treating Eports in Korea as a real sport. Players need to put in the practice time, create leagues, and have coaches for each team. Broadcasting of Esports matches are done live and stadiums for these Esports events look very similar to a pay-per-view boxing match. Korea even has its association called the Korean Esports Association (KeSPA) which was created in 2000. It is a part of the Ministry of Culture, Sports, and Tourism and it manages 25 of Korea’s top Esports games. Some of these games include Starcraft II, League of Legends, and DOTA 2.
Another reason why South Korea is considered the Esports capital of the world is how they broadcast Esports events. They have been broadcasting Esports events on TV, online, and via live streams for over 20 years. These broadcasts not only brought in a large audience but boosted the Esports industry in Korea. This led to stadiums in Korea soon being filled with Esports fans which brought more legitimacy to Esports. These days professional gamers like Faker are seen as celebrities and professional athletes. Most Koreans are well educated about Esports compared to other countries. Therefore, to truly appreciate Esports, one must attend an Esports event in Korea.
The Mecca for Professional Gamers
South Korea has some of the top pro gamers in the world. Esports has created an ecosystem in Korea that drives a lot of the youth in Korea to pursue a career as a pro gamer. Koreans of all ages can be seen playing video games at PC bangs or at home. PC bangs have become very popular in Korea. This is due to the fact, that it is looked at as a place students can go to release stress from school work. These computer gaming rooms are around almost every corner and best of all…very cheap. Many Korean gamers put the same amount of dedication into their gameplay as their studies. As South Korea is known for its “study culture”, you can see why South Korea can produce high-level pro gamers.
Since South Korea has an extremely large gamer community. It only makes sense some of the top gamers come out of Korea. The gamer community in Korea is similar to the academic community in Korea. Koreans have been competing in academics since they were young. Naturally, this competitive drive spilled over to gaming where rankings are what matters most. Therefore the amount of time Koreans put into their studies, many pro gamers put the same amount of time playing games.
This is why Koreans are so good at video games, it all comes down to one word…practice. If you want to be one of the top-ranked players in Korea, you need to put in a massive amount of practice time just to compete. The top-ranked pro gamers in Korea then become professionals. They are then recruited by some of the top Esports teams not just in Korea but around the world. Because of the passion of these pro-gamers in Korea, Korea has a significant influence on the video gaming industry globally.
The Future of the Gaming Industry in Korea
Many gaming companies in Korea have started to look towards virtual reality (VR) gaming, especially the Metaverse. VR games have already been created and most malls or gaming centers in Korea have some form of VR games people can try out. Many of these games focus not on competition but rather on bringing people together for an immersive experience. Most of the VR games created in Korea are designed to be played with friends, couples, and family members. This shows that many are looking to get into the Metaverse space. Therefore, this could bring in the mass market, people who were not fans of gaming could be more open to the Metaverse.
Another hot trend in the gaming industry is the emergence of digital assets in gaming. Game developers in Korea are increasing the pool of in-game purchases. However, gamers don’t actually own any digital assets. However, digital assets via Blockchain technology can transfer the ownership of digital assets to the players. Therefore shortly, gamers will be able to monetize their skills. They will be able to trade or sell their items (digital assets) for real currency. As Blockchain technology improves, more and more gaming companies in Korea will use digital assets to revolutionize the gaming industry. It will allow them to create new opportunities for both game developers and players that enable a new kind of entertainment market. Which Korean gaming company will enter this new trend first? We will have to wait and see.
