NHN making Asian inroads

The game business in Northeast Asia has lifted the earnings of NHN Corp. the Internet company that runs the game portal Hangame and the search portal Naver. NHN announced yesterday that sales in the first half increased 41.5 percent from a year earlier to 108 billion won ($93 million). Operating profit was 39 billion won and net profit was 31.7 billion won. Half-year sales exceeded 100 billion won for the first time since the firm was established six years ago. Of total sales, games made up 44.4 percent, followed by search sales at 31.4 percent ― the latter coming from companies that pay to list their Web site as a priority site in Naver’s search engine. Advertising sales made up 14.9 percent. In a conference call after the company’s second-quarter earnings announcement yesterday, NHN vice president Lee Hae-jin said that in the second half, the company will beef up its search functions and increase game operations by introducing new online games such as “Archlord” and “You are the Golf King.” This will include expansion of its game portal businesses in Japan and China. “We will focus on increasing sales in Japan and China, based on simple games,” he said. Hangame Japan currently is at the top of the Japanese game portal market, with about 65,000 to 70,000 users logged on simultaneously. First-half sales were 8.3 billion won. The Web site was not marketed but relied mainly on word of mouth. However, NHN plans to begin marketing operations in the second half to attract banner ads and more users, Mr. Lee said. In China earlier this year, NHN took over managerial rights of the country’s largest Web game company. The company will add 20 more self-developed games to upgrade the Chinese game portal service. Mr. Lee did not seem worried by KT’s new portal service Paran, which opened last week. “Recently, CJ gave up on its plans to create an Internet portal. It is difficult for large companies, no matter how big they are, to penetrate a market where we are holding our ground. Paran is no threat,” he said by Wohn Dong-hee