Alliances being made in online game sector

Big is apparently better in the game industry, as major online game companies have been actively pursuing mergers and acquisitions with smaller firms. They are also spending more money to make Hollywood-style “blockbuster” games and cranking up their marketing expenses. Last week, Gravity Corp., which operates the online game Ragnarok and is listed on the Nasdaq, bought enough shares of the game developer Triggersoft to become its largest shareholder. Triggersoft is a small firm but has developed Gravity’s “ROSE Online” as well as other strategic role playing games for the PC. Neowiz Corp., which runs a game portal, spent 6.5 billion won ($6.5 million) recently to gain a 35-percent stake in the game developer ThingSoft. It also bought the international rights for a game that ThingSoft is currently making, which is tentatively called “Project GG.” Companies are investing big because they see bigger profits. In 2003, Neowiz bought the game developer Ntixsoft for 10 billion won. Ntixsoft developed the online game “Yogurting,” which began open beta testing this month. In November, Neowiz exported the game to Japan for $3.4 million. CCR, developer of RF Online, sold the game rights to China for $10 million. NHN spent about 11.5 billion won to develop the online game “Archlord,” which was released in late March, including 200 million won on recording the soundtrack with the London Symphony Orchestra. In addition, it has already spent about 3.5 billion won on advertising. Despite the huge sum, the company said that even if it experiences slow growth in players in the beginning, it will only take six months to recover all the investment costs, and then there are rights to be sold to other Asian countries. “Games of this scale usually last at least five years, so if you do the math, you can see why it’s profitable,” said Moon Tae-sik, head of NHN’s game division. Games to be released over the rest of this year will help to determine whether game publishers are thinking on the right track. by Wohn Dong-hee