NHN looks to regain former glory as online game powerhouse

South Korea’s first-generation game developer NHN Corp. is gearing up to regain its past glory as the leader of the game industry.

The tech giant announced an organizational reshuffle on Monday, which centers around NHN Bigfoot. 

The Cloud service provider explained the restructure is to focus more on social casino games this year; with the long-term goal of expanding its presence overseas and revenue base to become a play-to-earn (P2E) business.

Last Tuesday, NHN Bigfoot merged with NHN PixelCube and NHN RPG. With the merger, the online board and sports simulation game provider boasts some 300 employees with annual sales of 100 billion won ($83.5 million.)

The company plans to create a synergy effect as NHN PixelCube mostly pushes out mobile games and NHN RPG develops role-playing games.

NHN Bigfoot CEO Kim Sang-ho will head the merged entity and closely collaborate with the Japanese affiliate NHN PlayArt, which specializes in mobile games.

NHN was incorporated in 2013, splitting off from Naver Corp. While its operations centered around the popular Hangame in the beginning, its main businesses have become Cloud, fintech, and entertainment in recent years. 

Sales from the gaming sector, which used to make up more than half of the company’s sales, only accounted for 24% of the total in the third quarter of 2021. 

The slide in online game sales became the stumbling block for the developer’s overall growth. 

The game sector slid from 437.6 billion won in 2018 to 409 billion won in 2020. The figure for 2021 is expected to be below the 400 billion won level despite the bullish online gaming market in recent years.

The Korea Creative Content Agency said the domestic game industry grew more than 40% in size compared to three years ago.

“NHN’s strategy has been investing the revenue from online games into new businesses,” an industry insider told The Korea Economic Daily. “The slowdown in revenue from the gaming sector limited the company's overall operations.”

NHN Bigfoot plans to reclaim its top position in the country’s online gaming market with Match 3 Puzzle and social casino games. Beyond that, the company plans to enter the P2E genre as well.

Game developers around the globe have been expanding their investments in blockchain-based games. 

Last October, NHN announced it will collaborate with video game developer WeMade Co. in developing blockchain-based products. Through the collaboration, NHN will release blockchain-based games such as Project Wemix Sports. 

WeMade launched its own blockchain platform Wemix a year ago. 

Even though games with cash trade-in options are currently illegal in South Korea and Japan, developers in both countries are hopeful the increased adoption around the world will result in eased regulations. 

NHN’s first product Hangame continues to maintain its relevance in the online board game arena. NHN will release GUNS UP! Mobile next month; and within this year, it will release AA Poker and social casino game Slot Marble. 

NHN Playart is also slated to release new products for the Japanese market. Its most recent release, Dragon Quest Keshi Keshi launched last December, ranked first place in the Japanese mobile game market. 

NHN Bigfoot’s Kim said, “We plan to combine our know-how in game development and data science-based digital assets management and incorporate these into the blockchain game industry."

Kim vowed to transform NHN into a “star player” by utilizing the company's experience in global game operations.

Write to Joo-Wan Kim at kjwan@hankyung.com
Jee Abbey Lee edited this article.