South Korea’s top Internet company Kakao and leading game developer Com2uS are reducing the size of their virtual world teams after their virtual world platform posted huge losses in the first half of 2023, according to a local news agency.
South Korea’s Kakao, Com2Us Wind Down Metaverse Units
Com2uS is a South Korean mobile and online game development/publishing company established in 1998. Com2uS develops games for Android, iOS, and other platforms. The company’s corporate offices are located in the United States, Korea, Japan, and China.
The company’s metaverse platform, Com2Verse announced that in January of this year it has received 4 billion won in strategic investments from Asiana Financial Group, Kyoho Bunko (a major Korean bookstore chain), and Kyowon Group, for a total of 12 billion won (approximately $9.5 million).
With this, Com2Verse has raised an initial capital of 15 billion won (approximately $11.85 million) from Com2uS, WYSIWYG Studios, and others at its inception, and has received an additional 16 billion won (approximately $12.64 million) in funding by attracting outside investment.
A Series of Losses
The company’s metaverse platform, Com2Verse, officially launched on Aug. 1 this year. However, the business arm behind the metaverse platform recorded an operating loss of about US$6.2 million in the first half of this year, and the company recently downsized its staff in its metaverse division.
Colorverse, another South Korea-based metaverse company, conducted a round of layoffs earlier this year without disclosing the details to the public.Colorverse, owned by Kakao’s gaming subsidiary Kakao Games and its affiliate Neptune, recorded US$8.6 million in losses last year.
Not Many Korean Citizens Regularly Use Metaverse Services
A survey conducted by the Korea Information Society Development Institute released in May revealed that only 4.2% of South Korean citizens regularly use metaverse services. The survey’s broad interpretation of what constitutes a “metaverse” platform included popular games Minecraft, Roblox and Animal Crossing.
Support from the Korean government
Since 2021, South Korea has been exploring the metaverse – defined by its science ministry as a space where virtual and physical reality merge so that people or objects can interact and create economic, social and cultural value.
Since then, South Korean authorities have shown a special interest in tapping the potential of the Moon-universe, and see it as a potential engine of growth for the new economy, with South Korean President Yoon Seok-yoon even directly stating that the technology is a national priority.But even with the government’s support, Metaverse has not made much of a splash in South Korea,and related businesses are also in the doldrums in Korea.
