Korea’s virtual human market expands AI, CG technologies

A virtual human, Han YuA. [Courtesy of Smilegate]

South Korean information technology (IT) companies are scrambling to expand their presence in the growing market for intelligent, communicating virtual humans as they project the market will grow to cover various industries.

Korean game developer Smilegate has developed a virtual human, Han YuA, based on its generative artificial intelligence (AI) program, and what distinguishes her from other virtual humans is her ability to communicate.

This feature was made possible because Smilegate equipped Han YuA with a specific personality based on its in-house AI engine. Feeding off this engine, the virtual human can even provide her own answers to surprise interview questions without human intervention.

In a recent interview with Maeil Business Newspaper, Han said that she “reads comments posted on social media to communicate with fans, as well as enjoying hobbies including reading and assembling LEGO.”

She added that she considers herself “more of an artist than a celebrity” and that “I want to inspire and move people through various creative activities like writing, music, and art.”

Han’s reading hobby suggests she learnt about books via AI and similarly with LEGO, she assembles virtual LEGO creations in a digital space.

“There are many virtual humans, but I think what sets me apart is my ability to express my own thoughts,” she said.

Developer Smilegate expects that content utilizing virtual humans will diversify as technology continues to advance.

The market for virtual humans produced using software like computer graphics and AI is gradually expanding.

According to the information and communications technology (ICT) industry on Sunday, virtual production company Vive Studios is expected to commercialize VIPLE, a solution providing the necessary technology to create virtual humans in a package format, this year.

Face Swap, one of the technologies in VIPLE’s solution, had been applied to media art at a store run by Samsung Electronics in Gangnam, southern Seoul.

ESTsoft, a traditional IT company, also picked virtual human business as its new growth engine and is producing significant results.

Earlier this year, the company began joint production of virtual humans specializing in foreign language education in collaboration with YBM, expanding the range of virtual human applications.

ESTsoft swung to an operating profit of 1.4 billion won ($1 million) in the second quarter of 2023 from a loss of 3.8 billion won in the previous quarter thanks to the growth of its virtual human business.

Dob studio, an IT startup that develops virtual human technology, is also confirmed to finalize series A investment in the second half of this year based on steady revenue growth.

Vive Studios, founded in 2020, received an investment of 5 billion won in pre-A series in 2021. The company recently collaborated with the Defense Media Agency to restore the faces of deceased military honors recipients.

According to market research agency Emergen Research, the virtual human market is projected to grow at an annual average of 34.2 percent from $29.5 billion in 2022 to 561.1 billion in 2032.

Virtual human production technology is gradually producing nearly human-like forms with lower production costs and time are decreasing.

However, interest in virtual humans from a marketing perspective has cooled compared to previous years.

A recent report by Samil PricewaterhouseCoopers showed that Rozy, a virtual human developed by a Naver Webtoon subsidiary, appeared in five advertisements in 2021 and six in 2022 but only two this year.

But the report added that virtual influencers in the expanding virtual market are expected to create new opportunities in various fields moving forward.

“When virtual humans are used more frequently, models used in printed and outdoor advertisements could be replaced by virtual humans in the future,” according to Kim Tae-yong, a professor at Kyung Hee University.