Study: Korea Online Game Market Could Exceed $2B In 2011

The Korean online game market could surpass $2 billion in revenues next year, as the country's game companies take steps towards rapid expansion overseas, San Jose-based Pearl Research said Monday as part of the results of a new study. Pearl said three of the top five Korean game operators grew revenues more than 50 percent in 2009, marking aggressive overseas growth among the country's top online game companies. MapleStory and Dungeon Fighter Online publisher Nexon recently announced for the first time that non-Korean sales accounted for the majority of its global revenue of 703.6 billion won ($585 million) in 2009, Pearl said. NHN, publisher of Soul of the Ultimate Nation established a U.S. arm in 2007, with U.S. revenues jumping 50 percent in 2009. Neowiz, publisher of CrossFire, saw overseas revenues rise 526 percent to 62.1 billion won ($52 million), outpacing all other segments within the company, Pearl said. Korean companies have helped lead the way with new online business models, including charging for microtransactions on top of a monthly subscription fee. Pearl said, "It remains to be seen if this hybrid model will be accepted by consumers and spread to other countries." U.S. companies are also gaining an audience in Korea. Electronic Arts' FIFA Online 2 temporarily topped online game rankings at internet cafes, thanks to July 2010's World Cup event. Blizzard's World of Warcraft is also a top online game in the region. Other leading titles include NCsoft’s Aion and Lineage series, CJ Internet’s Sudden Attack and Nexon’s Dungeon and Fighter (a.k.a. Dungeon Fighter Online). PC usage in Korea is among the highest in the world, at 80 percent. Pearl said that games such as Blizzard's StarCraft II will help expand the games market in the region in the near-term, but a "glut of content" in the market, government scrutiny and rising development costs could hinder further expansion.