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[Korea] 2010 Outlook: Browser-based Games

The 2010 Outlook for the Korean online gaming Market. This posting discusses the outbreak of web-based games and its future outlook in Korea.

Thanks to the success of browser games likes of Tribal Wars (부족전쟁: Kor) and 7th Dragon (칠용전설: Kor) in Korea, the Korean browser-based game market is hitting its peak. More than 10 games was launched in 2009 and more games will follow the suit in 2010.

From Small to Major Publishers

From a developer's perspective, browser-based games have their certain merits; lower production costs and shorter project time are required to create games. Hence higher ROI once the game operation reaches to a certain point.

For such reason, new and small studios are eager to enters the market. According to an industry source, in general it takes about 4 experienced programmers to create a browser-based game in 4 to 6 months, 1 year tops within a 100 million Won budget (US$ 77,000).

A publisher who operates a game portal can use a browser-based games to entice casual gamers to its portal site since it's very easy to play. A game portal with high paying users claimed that ARPU jumped up after they launched a browser game.

Korean publishers preferred a Chinese game that already has been operated for some time and gained a fan base. And the willingness of Chinese games to slash their price to enter the Korean market doesn't hurt, either.

Starting with Chinese games, Korean publishers plan to learn operation know-how then expand to develop their own games with their intellectual property. 

Long Term Strategy is Needed

Everyone seems to consider the market segment untouched and untapped so far. The competition, however, is so fierce that there is no doubt that the market will be quickly crowded soon. 

The browser-based gaming market is relatively small compared to online gaming market. Commercially successful games likes of Tribal Wars and 7th Dragon generated monthly revenue less than 300 million Won (US$ 0.2 million). So publishers are looking for an alternative revenue source like 7th Dragon 'channeling' with other portals. 

The common concern among publishers is that players will not tell the difference between games that will be flooded in this year. So each publisher needs to develop a differentiated strategy according to its business nature. Major publisher has a luxury to pay for the education as the company doesn't expect to reach a break even point right away. So it tends to try learn as much as possible from the operation experience. 

In the meantime a small self-publishing developer is more likely to act on instant-monetizing. In this case a game should stand out of increasing competition first. Then it can venture into other revenue sources such as channeling down the road. 

Murim Empire (무림제국: Kor)>

Genre Diversification

It seems that game portals showed best results out of adding browser-based games to their lineups. CJ Internet's game portal NetMarble has shown a success as channeling 7th Dragon. NCsoft leveraged Murim Empire with AION as throwing a co-event. 

Major game portals set up a new task force team to secure new contents and develop business strategies from channeling to self-publishing around browser-based  games. Or even some company brought in an external team to develop a browser game on its own.

It is also a good opportunity for emerging game companies that prepare to launch a game portal site. Tongyang Online launched a game portal,Gamehama, with three browser games including Apocalyps and Three Kingdoms W and showed some positive results. 

As the market became more crowded, there has been some efforts to differentiate themselves from others. 

MGame plans to launch European games such as Sci-Fi RPG Dark Orbit and Sea Fight. NCsoft allocated some personnel to develop a flash MMO browser game. 

"When it comes to browser games, the key to success is planning. There is no such thing as over-planning. Abusing in-game items to generate more items definitely shortens the life cycle so planning for commercial service should not be treated lightly." said the industry insider.  

<A French browser-based game WAKFU>

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