Video game market in South Korea

South Korea is the world’s 4^th largest gaming market, and has seen steady growth over the past decade.

Gaming has been a part of Korean culture for decades and over 74% of the population plays video games.

South Koreans gamers are big fans of massively multiplayer online games (MMOs) and the most popular kinds of games include roleplaying video games (RPGs), shooters, and real-time strategy (RTSs).

Mobile gaming dominates the market, and PC gaming remains massively popular due to the abundance of PC cafés, and the popularity of e-sports.

Console gaming is still a niche market, but has seen strong growth in recent years.

Key opportunities for Canadian video game companies in South Korea

• Free-to-play mobile games, including mid-core and casual
• PC games, mainly RPG, shooters, and strategy
• Increasing interest from Korean companies in releasing console games bring opportunities for Canadian developers with expertise in console game development
• Web3 games for release on Korean platforms targeting Asian markets.

Notable challenges for Canadian video game companies in South Korea

• Difficult market to penetrate without a local publishing partner
• Professional translation/localization is important to appeal to the local audience

South Korea business landscape

The gaming industry in Korea is dominated by a limited number of large companies, known as 3N+K2 (Nexon, NCSoft, Netmarble, Smilegate, Kakao Games, and Krafton), which are behind the majority of blockbuster games released in recent years. In fact, South Korea is currently the world’s largest producer of mobile games with a production cost of USD $1 million or more.

This makes it challenging for smaller game developers to compete and the COVID-19 pandemic has led to a further concentration of the industry. Some of the most popular titles in Korea do include games developed by overseas studios, although localization and local publishing partners are important to successfully enter the market.

Major Korean publishers are increasingly looking beyond Asia to become global players and are interested in working with foreign developers for global publishing deals, including for multi-platform games.

In addition, many Korean companies are betting on Web3 as the future of gaming and have launched their own platforms and coins.

These plans are currently focused on international markets since play-to-earn game have yet to receive a rating by the Korean Game Rating and Administration Committee (GRAC), which is necessary for a game to be legally distributed and serviced in Korea.  The Korean government has long been worried about speculation in games leading to gambling and addiction. That said, the trend towards web3 gaming among Korean gaming companies is here to stay.

Summary

South Korea is a large and dynamic gaming market, with opportunities for Canadian gaming companies interested in expanding their reach to the Asian market, especially for PC and mobile games.

There are also opportunities to work with Korean companies for worldwide distribution of games, where Canadian companies’ experience in Western markets and with console games is an asset.

For more information on video games in the South Korean market please contact Régine Lapointe, regine.lapointe@international.gc.ca, or SEOUL-TD@international.gc.ca.