A couple of months ago Korea Creative Content Agency published a huge report on South Korean gaming market. The general capitalization of this segment exceeded $9.16 billion. The revenue from mobile games went over $754 million. The general growth of the mobile game market in South Korea exceeded 33.8% compared to 2011. The main suppliers of mobile games to South Korea are China (38.2%) and Japan (27.4%). Many American and European companies are eyeing this market. Xsolla talked with business directors form Ukrainian studio Absolutist and Russian company Zenna Apps and found the main peculiarities of working with games in South Korea.
Computers and Smartphones
Online games continue to be the biggest part of Korean game market. Mobile platforms are slowly getting more and more grip on the market. During the last 12 months this part of the market grew 50% compared to 2012.
Among РС games League of Legends (LOL) remains the most popular one. This project from Riot Games appeals to the Korean audiences. In 2014 the first LOL tournament will be held in this country. Experts suggest that the game will make the same splash in South Korea as Starcraft one did. Today most of the popular online games in Korea work with F2P. Wi-Fi in South Korea is widespread, so gamers can enjoy their game even during subway trips.
«Korean gamers are big fans of online gaming. If you’re not playing, nobody will talk to you. Gaming is a part of their culture. Competitions in games drive the whole F2P-model forward», — says business development director of Absolutist Ltd. Tatyana Garat.
«People from Asia usually don’t like aggressive monetization in games. They especially hate to pay for getting into the game. However, they will gladly spend money if they find the right entertainment to fit their liking», — thinks Zenna Apps CEO Inna Zaichenko.
A year ago mobile games started to grow in Korea. Local developers jumped in to earn first millions. The general revenue of this segment in 2013 was over 1.2 trillion Korean won ($1=1066 won). Online games in general surpassed 7.3 trillion won.
«South Korean market is very interesting. This is the only region in Asia where mobile games are more popular and more profitable than online and video games. The mobile games revenue supplies over 37% of the whole game market profits. ARPD in Korea is higher than in USA. It’s about $1,5–2,5. Japan remains on the top with $3.12, but KakaoGame quickly works on changing there numbers», — says Inna Zaichenko (Zenna Apps).
«This is the most profitable markets with the greatest conversion (much higher than in Europe or USA). Top positions among top grossing apps in Google Play in South Korea could potentially bring 50% more money than in Russia. I think that the growth in this sector started in 2011. KakaoTalk received a great in-app game store which was also hugely successful. It contributed to the general popularity of mobile games. I think the market will continue to grow but slower than in 2012 and 2013», — says Tatyana Garat.
Zenna Apps thinks that the maximum growth is still ahead. It may continue till 2014–2017. Asian countries will remain among the biggest consumers of games in the whole world.
Localization and integration
They key to the South Korean market lies in thorough localization: translation, marketing, payment systems adaptation, the wise choice of distribution platforms.
The biggest leader of the market is Clash of Clans. The game achieved this success with the help of great localization. But in China the project was not so popular. This strategy was downloaded over 600.000 times, however there were almost no payments. Developers used Google Play. This payment method is not very popular among Chinese gamers. It is essential to get a reliable payment partner in South Korea.
«Asian market is very old and extremely developed. It has rules and regulations of its own. For example you have to enter ID / passport number while making a mobile payment on the phone! Banks gather a lot of information before making a transfer. You cannot possibly make a transaction in one click. This greatly affects conversion. Such limits help popularizing alternative payment methods, created for gaming crowd. These payment systems make quick and anonymous payments available for everybody. It is absolutely necessary to work with local partners in China to earn money. In 2014 Xsolla will continue working with local Chinese payment systems (including very popular gaming paycards and mobile wallets). These instruments are instrumental to create great payment experience and get better marketing», — says Xsolla payment system manager Sergey Peshkov.
Even a popular mobile hit Candy Crush could not achieve success without integration in messenger KakaoTalk. Working with message platforms is one of the safest ways to get success in China and South Korea.
«Messengers are huge in Asia. They have tons of users who are used to pay for different stickers and emoticons. Kakao is a little ahead of its main competitor Line in terms of sheer mass of users (110 mln). This leader sets new trends and decides the future of the whole industry», — thinks Inna Zaichenko (Zenna Apps).
Local politicians however are trying to limit the use of games with the new laws. These governmental initiatives are supported by Korea’s Saenuri Party. This organizations is held by the current president Park Geun-hye.
The biggest adversary of games in Southern Korea is doctor Shin Eun-jin. She considers games to be as harmful as alcohol, drugs or gambling. Activist proposes organizing a National Addiction Control Committee. This body will control all sorts of addictions including game addictions.
This initiative is also backed by parents. They want their children to spend more time studying and less time playing. Ministry of Healthcare will organize a public talk of this problem.
South Korea already has strict legal norms which regulate the amount of time gamers can spend in the virtual world. They cannot access the game during the time period between 12 pm and 6 am. However young gamers already found a way to bypass these restrictions.
«Asia has the most dedicated gamers in the world. They will never quit playing. Laws and regulations are powerless here», — sums up Inna Zaichenko (Zenna Apps).