Korean game industry’s Jan.-June revenue down 10.9% on lack of new titles

New game TL [Courtesy of NC Soft]

South Korean game publishers saw their combined revenue plunge to below 10 trillion won ($7.6 billion) for the first time in two years in the first six months of 2023, raising an alarm that they may enter a period of slump amid lack of new titles and increased competition with Chinese counterparts.

According to a recent report released by the Korea Creative Content Agency, the country’s game industry raised 9.4 trillion won in sales in the January-June period of 2023, down 10.9 percent from a year ago. It marked the biggest decline among 11 content industries. It was also the first time that sales fell below the 10 trillion won threshold since the first half of 2021.

Game exports also declined.

The industry’s exports stood at $3.4 billion in the first six months of 2023, down 5.7 percent from the same period a year ago.

Exports of the entire content industry rose 1.3 percent to $5.3 billion during the same period.

Industry insiders note that the decline in game exports is noteworthy given that it is responsible for 60 percent of the entire content exports.

The report – based on a survey of 1,500 game developers –identified several factors contributing to the sales decline, including lack of major title releases and sluggish sales from MMORPGs.

While existing titles with loyal user bases continue to generate sales, game developers may see further slowdown if they fail to launch new titles, the report warned.

It highlighted risks associated with the mobile MMORPG market, a stronghold for Korean game developers. The market has already begun shrinking, and a slew of similar genre games has contributed to the shrinkage.

The report noted that once-promising innovations such as virtual reality (VR), cryptocurrencies, and metaverse have failed to boost the industry, with even higher entry barriers into overseas markets dominated by casual games.