Market Insight

Netmarble’s Grand Chase shuts down Korean operations

November 20, 2015  | Subscribers Only

Chenyu Cui Chenyu Cui Senior Research Analyst – Games, IHS Markit

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Netmarble’s Grand Chase Korea will officially close down on December 31st after 11 years of service, and the developer KOG has stopped working on the game as well. Poor user engagement and yearly decline in revenue contributed to the closure but the game’s mobile version has been launched recently published via Netmarble.

Our analysis:

The closure of Grand Chase is not surprising given the general downturn being experienced in the mature PC gaming market in South Korea. Consumer spending within the Korean PC online gaming market suffered a yearly decrease of 5.3% in 2014 and the decline is likely to continue in 2015 considering fewer new launches of hit titles and user traction loss of incumbent ones. Compared to solid performance of individual session-based multiplayer titles, traditional role playing games have faced more challenges of user fatigue due to a dearth of content updates and a lack of innovative gameplay. Also the game has shut down its service in North America, Taiwan and Brazil in 2014, and its Chinese service has no upcoming testing phase since the close beta in 2013. Additionally, the developer KOG’s focus from Grand Chase to Elsword has indicated fewer content updates and less frequent release of expansion pack, which predicted the closure of the game.

Netmarble has transited its main business from PC to mobile segment since 2012 earlier than most PC publishers. In 2014, 89% of its online gaming operation revenue came from mobile and the share is likely to increase in 2015. The PC games business is fully dependent on its web board games and casual titles rather than core MMOGs. As such, we could suggest the closure of Grand Chase is to divert more financial resources to mobile games development and we could expect more role playing games with poor performance to be closed in the future.

 

Geography
South Korea
Organization
CJ E&M
Research by Market
Media & Advertising
Category
Games
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