[Featured Stock] Gaon Media Develops Essential XR Technology for Metaverse... MS Wins 24 Trillion KRW AR Project

[Asia Economy Reporter Hyungsoo Park] Gaon Media's stock price is on the rise. The news that it signed a business agreement for the 2021 project of the 'XR Flagship Project' promoted by the Ministry of Science and ICT appears to be influencing the stock price. The government announced the 'Virtual Convergence Economy Development Strategy' jointly with related ministries in December last year. XR is being intensively fostered as an important pillar of the Digital New Deal. Since the economic effect is planned to be raised to 30 trillion won by 2025, the market is expected to continue expanding.

At 10:07 a.m. on the 6th, Gaon Media was trading at 12,700 won, up 4.1% from the previous day.

Extended Reality (XR) refers to ultra-realistic technologies encompassing Virtual Reality (VR), Augmented Reality (AR), and Mixed Reality (MR). An agreement was signed to additionally develop 5G communication-based XR devices. 5G technology, which transmits large-capacity data with ultra-low latency, is necessary to run XR content. The consortium consists of Locus, Dongguk University, Gumi Electronics & Information Technology Institute (GERI), and Electronics and Telecommunications Research Institute (ETRI).

Gaon Media, selected last year for the education and training system construction sector of the project, will carry out the XR Flagship Project worth 10 billion won until 2022. Through the first-year project in 2020, XR devices used for education and training simulations to improve police complex terrorism response capabilities were developed. The XR Flagship Project is one of the Ministry of Science and ICT's 'Immersive Content New Market Creation Projects,' a large-scale government-led pioneering project to foster the immersive content industry, a core non-face-to-face field including 5G.

A company official said, “We will expand the XR business into manufacturing, construction, medical, and defense sectors by utilizing Gaon Media's AI and 5G technologies and know-how.” He added, “Especially since XR technology is essential to realizing the recently spotlighted Metaverse, we will successfully complete the advancement of 5G-based solutions this year.”

The Metaverse is a compound word of Meta, meaning abstraction, and Universe, meaning the real world. It refers to a virtual world implemented online. According to market research firm Strategy Analytics, the Metaverse market size is expected to reach 315 trillion won by 2025.

Microsoft (MS) recently won a contract worth about 22 billion dollars (approximately 24.8 trillion won) to supply augmented reality (AR) headsets to the U.S. Army combat units. The U.S. Army is building the 'Integrated Visual Augmentation System,' which enhances combat environment analysis capabilities using augmented reality technology. According to the contract, MS will supply enough headsets for about 120,000 close-combat soldiers. The U.S. Army plans to use this equipment not only for training but also in actual combat situations.

Giant Step, which was listed on the KOSDAQ market on the 24th of last month, rose about five times compared to its public offering price of 11,000 won due to expectations of benefiting from the Metaverse.