Korean app market One Store to venture into SE Asia

One Store Co., South Korea's homegrown app store, will venture into Taiwan and Southeast Asia within the year, aiming to crack Google and Apple's duopoly in the global app market as it has at home.

The marketplace of mobile games, web novels and webtoons, or digital comics, will launch its services in six other Asian countries in the second half of this year, mostly in Southeast Asia, before later expanding into North America and Europe, its CEO Lee Jaehwan said on Monday.

He did not identify the five other Asian countries, except for Taiwan, where it is planning to build its footprint.

Last year, One Store cracked the domestic app marketplace dominated by Google Inc. and Apple Inc., powered by 40.6% average annual revenue growth from mobile games since 2018.

It rose to second place with a share of 13.8%, outranking Apple Store with an 11.6% share. Still, they are far behind Google Play, which commands 74.6%.

"After we beat Apple Store, One Store has been drawing attention from foreign governments and media," Lee told a news conference ahead of its bookbuilding on May 9-10.

"One Store will be the only alternative to Google Play and Apple Store in the market, where both app stores hold a near-monopoly."

To attract top-grossing games and webtoons, One Store reduced commissions to 20% from 30% of the app operator's earnings in July 2018. It will apply a commission rate of 20% in other countries as well. 

EYEING 1 TRILLION WON MARKET CAP 

Lee said the company would proceed with its initial public offering later this month despite its sister company SK Shieldus Co.'s cancellation of an IPO last week due to weak investor demand. 

Its IPO on the Korea Exchange will become a stepping stone to building a footprint in the global app store market projected to grow to 300 trillion won by 2025, he noted. That is more than 40 times bigger than that of the domestic market estimated at 7 trillion won.

The former app store of SK Telecom Co. has bulked up through mergers with the app stores of the country's two other telecom providers -- KT Corp. and LG Uplus Corp. -- and that of Naver Corp., the country's No. 1 internet portal.

SK Square is now its largest shareholder of the homegrown app store with a 47.5% stake, followed by Naver with a 25%. 

One Store proposed a price band of 34,300 won and 41,700 won to raise a total of 228.4 billion won to 277.7 billion won. Its IPO valuation suggests a market cap between 910 billion won and 1.1 trillion won.

Last year, the app store received a combined 16.8 billion won in funding from Microsoft Corp. and Deutsche Telekom Capital Partners (DTCP). Launched in 2016, One Store posted 38% on-year growth in 2021 sales to 214.2 billion won.

One Store is also preparing to diversify into the advertising business to beef up earnings, Lee added.

Write to Seok-Cheol Choi at dolsoi@hankyung.com
Yeonhee Kime edited this article.