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Chinese investment in Korean gaming industry on the decline

All Headlines 11:43 September 09, 2016

SEOUL, Sept. 9 (Yonhap) -- Chinese investment in the South Korean online gaming industry has been significantly falling this year, a report showed Friday, as Korean game makers are in an uphill battle with Chinese rivals over mobile games.

Led by Tencent Holdings Ltd., the operator of China's biggest mobile messenger WeChat, Chinese Internet firms aggressively invested in Korean game makers from 2010 to 2014.

From 2006 to 2014, Tencent invested in 15 Korean game makers, including Kakao and Netmarble Games Corp., which is formerly known as CJ Games Corp.

According to the report released by the state-run Korea Creative Content Agency (KOCCA), no Chinese firm has made a direct investment in a Korean game maker this year.

Korean game makers once dominated PC-based online games, but they have failed to produce a big hit in the mobile world, where Chinese makers are rapidly catching up.

The report attributed the decline to Korean firms losing their edge in smartphone games.

"Many mobile game makers produce similar games by copying successful games of each other, making local consumers shun such games," the report said.

"With everybody losing confidence about a success, investment in the gaming industry is frozen," it said.

Kim Ji-woong, director of K Cube Ventures, told the report that Chinese firms may have no reason to invest in Korean game makers because Chinese game-developing technology does not lag behind Korea's technology.
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