162 views 6 mins 0 comments

South Korea’s major video gaming companies bet big on China’s continued openness to franchises with proven track record overseas

In Business
February 14, 2024

A version of this article was first published by The Korea Times in a partnership with the South China Morning Post.

South Korea’s major video gaming companies see bright prospects for their operations in mainland China on the back of recently granted licences, according to industry insiders and analysts, after grappling with a regulatory crackdown and geopolitical risks in the market over the past few years.
Titles from Nexon, NCSoft Corp and Netmarble Corp – the top three game publishers in South Korea – were among the latest imports approved for commercial release on the mainland, the world’s largest video gaming market. These included Nexon’s Dungeon & Fighter (DnF) Mobile and Netmarble’s The King of Fighters All Star on February 2, and NCSoft’s Blade & Soul 2 last December.

With at least 18 Korean video games licensed for release on the mainland since late 2022, those top developers are betting big that China’s openness would continue and enable more titles in future to be enjoyed by gamers on the mainland, according to industry insiders and analysts.

Video gaming companies “would naturally prefer [to get licences for] products already with proven performance and achievements [overseas]”, according to a report by Shanghai-based video gaming industry research site GameLook, which referred to the strict control on the number of imports released in the market.

Dungeon & Fighter Mobile, part of the role-playing game franchise first published by Nexon in 2005, will be operated in mainland China by Tencent Holdings. Photo: Handout

South Korean video game imports already represent a “a bright spot in the market”, the GameLook report said.

At least nine major Korean games were released on the mainland from June to September last year, generating more than 3 billion yuan (US$417 million) in total revenue as of October, according to GameLook.

The National Press and Publication Administration, the agency in charge of licensing video games in China, on February 2 published a list of 32 imported titles approved for release, which included side-scrolling action role-playing game DnF Mobile to be operated in the domestic market by Tencent Holdings.

Seven Korean titles – including Lost Ark by Smilegate, Nexon’s MapleStory M and Ni no Kuni: Cross Worlds by Netmarble – were among the first batch of 44 imports licensed for release on the mainland in December 2022 since a regulatory crackdown in the industry.

Netmarble Corp’s Ni no Kuni: Cross Worlds is a mobile game that is part of the Ni no Kuni series that was introduced in 2010. Photo: Handout

The recent approvals, according to industry insiders, signalled that China has eased its restrictions on South Korean video game imports.

Before December 2022, there were only two South Korean games that received licences on the mainland in the six years since March 2017.

South Korea asks China to stop banning its games

Among the latest batch of foreign game imports approved for release on the mainland, DnF Mobile came as a surprise.

In collaboration with Tencent, Nexon originally planned an earlier release of DnF Mobile in China. The mainland launch of the mobile game, which was first released in South Korea in 2022, was suddenly cancelled in August 2020 even though it had more than 60 million pre-reservations at the time.

Tencent, which runs the world’s largest video gaming business by revenue, and partner Nexon cited the need to make adjustments based on regulatory requirements.

DnF Mobile was adapted from Nexon’s flagship personal computer game Dungeon & Fighter, which was released in August 2005. This franchise has since become one of the world’s highest-grossing video games, with more than US$22 billion in lifetime revenue as of June 2023.

A team of DnF Mobile designers said last Tuesday via the game’s official WeChat account that a new round of testing will start at the end of this month, showing that “our preparations have finally entered a new stage”.


The resurrection of China’s video gaming industry

The resurrection of China’s video gaming industry

DnF Mobile has raised expectations in China’s gaming community, with many players expressing their excitement about its regulatory approval on social media. At the same time, analysts have also indicated that the game’s release in China will help boost revenue for partners Tencent and Nexon.

Nexon, for example, already said that the growth of flagship DnF desktop game and MapleStory: The Legends of Maple on the mainland helped it achieve record-breaking revenue in 2023.

Many of the recently approved South Korean games are also part of popular franchises that are generally favoured in the mainland market.

Some analysts, however, noted that it could also pose a challenge to introduce old franchises, compared with newer, more advanced video games in China.

For older franchises like DnF, “obtaining a licence is more about using existing resources”, said Zhang Shule, an analyst with CBJ Think Tank. “Its gameplay and concept lag behind the times, and it would be even harder to entice [more] players to pay for the game based solely on emotional connection.”

The news is published by EMEA Tribune & SCMP210520-twitter-verified-cs-70cdee.jpg (1500×750)Follow our WhatsApp verified Channel 

Support Independent Journalism with a donation (Paypal, BTC, USDT, ETH)
whatsapp channel
/ Published posts: 45314

The latest news from the News Agencies