Korea’s number one mobile communication platform Kakao and major portal site Daum are going to come together. The joint corporation would be called ‘Daum Kakao’.
Daum announced the merger on the 26th of May. Both companies held a board of directors to agree the merger and are going to complete it at a general meeting of stockholders by 27th of August. If it goes well, Kakao’s 1.556 share becomes Daum’s 1 share and ‘Daum Kakao’ will be founded on October 1.
Though Daum seemingly merges Kakao, what we need to recognize of it here is that Kakao’s back-door listing. While Kakao is a unlisted corporation for now, Kakao is easily able to be listed on KOSDAQ without any screening under the name of Daum Kakao thanks to the merger.
Both companies said the merger is to maximize their competitiveness in the shifting global market. “Internet business growth can be acquired by taking advantage of Kakao’s mobile traffic while Daum’s technology, content, and platforms can accelerate Kakao’s mobile information and life revolution,” said Daum. “In spite of the merger, everything will remain the same. Daum Mobage and Daum Game which is going to be separated this July also remain intact.”
The merger is expected to be on a scale of $697M of annual sales, $144M of business profit, and $130M of cashable asset on 2013 financial statements basis.
Kakao deleted a regulation that enforces a game on ‘Play Kakao Games’ to be released on both Google Play and Apple Appstore. The change will be made by May 1.
Kakao implemented the regulation in March 2013 in order for players from both Android and iOS to play altogether at the same time. But this regulation came to the developers as money and time waste because they were forced to develop the game for both platforms simultaneously.
The change is made because Apple’s long review on a game brought a delay in release at once. If a game is rejected from a 2-week-long review of Apple Appstore, another 2 weeks takes to get reviewed.
Considering that iOS only takes 5~10% market share in South Korea, it’s really inefficient for the developers. “We deleted it in order to ease off our partners’ burden of releasing both platforms at the same day. But a game for iOS should still be available,” said Kakao.
Kakao spoke its blueprint targeting hardcore games at Gametech 2014 held on 3 March.
SungWook Choi, the senior manager of international business development of Kakao, presented a few statistics to prove Kakao Game platform’s power on hardcore games such as RPG and CCG(card collectible games) as well as casual games. According to his data, the platform possesses 15M daily active user(DAU) and 22M monthly user in Korea. (as of March 2014)
He also noted that there is actually a game that reached accumulated revenue of $95M, followed by 5 games with $7M and 25 games with $1M.
Moreover, some top mobile RPGs reached DAU 1M and monthly revenue $15M, matching records of any PC-based online games. “Despite of platform charge, there is a chance for hardcore games to get their sales increased with our great number of users,” said Choi.
Kakao also announced that new service for hardcore gamers will be available soon, strengthening its competitiveness against other rising game platforms such as NHN’s Naver Band.
Naver is reportedly going to launch a new gaming platform on its SNS Band in April.
According to industrial experts, Naver is going to launch the platform with about 10 mobile games. The most of front-line would be brand-new titles while popular titles would follow up later.
The Naver Band is pretty attractive for mobile game developers because it just takes 20% of revenue away from them while Kakao Talk takes 30% away. That is, they guarantee the poor developers of maximum 64% of profit.
On top of that, the #1 portal site in Korea supports diverse promotion including webtoon PPL, gaming dedicated page, pre-registration event, CPA mileage save, etc. This is undeniable bait for the small companies in lack of marketing budget.
Besides the PC portal, Naver Mobile boasts 21M daily UV as of July 2013 and more than 20M has downloaded the Band as of October 2013. 20M is nearly a half of Korean population.
Emerging of the Band gaming platform, the industry is more than welcoming it since they have been waiting for another platform besides the Kakao which has been exclusively conquoring the market so far.
Exact date of the debut is not announced yet.