[Interview] One Store CEO "Expanding to Southeast Asia in 2022... IPO Preparation Also Progressing Smoothly"

Lee Jaehwan, CEO of One Store, Interview on the 23rd
First Cross-Platform with Tencent to Launch in September
One Story Expected to Unveil in October
IPO Preparations Underway... Peer Group Selection in Progress

[Asia Economy Reporter Cha Min-young] The native app market One Store has been able to dream of global expansion beyond becoming the second-largest app market thanks to the 'Leadership of Jae-hwan Lee.' Jae-hwan Lee, who led the media and content divisions at SK Telecom and SK Planet, has been leading the organization since One Store's launch in March 2016. In 2018, despite operating at a loss, he showed a gambler's spirit by boldly setting a 20% commission rate. Preparations for One Store's initial public offering (IPO), which will be recorded as the first spin-off subsidiary listing in SK Telecom's 37-year history, are also steadily underway.

'Leap to a Global Multi-OS Content Platform'

On the afternoon of the 23rd, Jae-hwan Lee, CEO of One Store, met with Asia Economy at Mill Studio near Dosan-daero in Gangnam, Seoul, and shared behind-the-scenes stories about One Store's vision declaration as a 'Global Multi Operating System (OS) Content Platform.' He said, "Looking back to the company's launch six years ago, I feel a great sense of change," adding, "It seems that my own gamble paid off."

One Store plans to enter overseas markets in 7 to 8 Asian countries in 2022. CEO Lee explained, "Taiwan, Thailand, Indonesia, and Singapore are the primary targets," adding, "Many domestic game companies have already entered these countries, and they have a large young population." In particular, by building a global service platform based on Microsoft's (MS) Azure cloud, developers can release builds launched domestically in multiple countries without modification.

Role-playing games (RPGs) and strategy games will lead market pioneering efforts. Domestic media and content apps, from webtoons to online video services (OTT), are also important partners. Cooperation possibilities with SK Telecom's OTT affiliate Wave are also anticipated. He emphasized, "We will raise awareness by leading with various K-content apps," and "We will actively utilize alliances with local telecom companies in places like Singapore to leverage promotional benefits."

A differentiated strategy to captivate overseas app developers has also been prepared. The core is to solve consumer pain points caused by major app markets like Google Play Store and Apple App Store not supporting local payment methods. CEO Lee explained, "In foreign countries, many payments are made using electronic wallets such as simple payment methods, but these are sometimes not supported in major app markets, leading to sideloading cases where users bypass via web access." One Store is testing ways to eliminate such consumer inconveniences by linking with companies that support local payments.

Tencent to Launch 'One Game Loop' in September

The cross-platform policy that breaks down the boundaries between PC and mobile, and mobile and PC, is expected to materialize as early as September. The unveiling of 'One Game Loop,' utilizing China's Tencent cloud platform, is entering its final countdown. Cross-platform enables mobile games to run on PCs, providing a seamless gaming experience. Cloud gaming is also part of cross-platform, and the scope of cooperation may expand.

One Store, which is also a shareholder of MS, will implement cross-platform with Microsoft. It was explained that the strategic alignment of interests with Microsoft was a key factor. The MS Store is also in competition with Apple's Mac Store. CEO Lee said, "As the leadership shifts from PC to mobile, MS Store is thinking hard about regaining it," adding, "We have gained an ally specialized in gaming, One Store." Specific cooperation methods are under discussion.

Conservative Estimate of 700 Billion KRW Target by 2025

He expects that when One Store directly enters the global market next year, the perception of overseas companies toward One Store before entering the domestic market will also change. App developers who aim for open payment are also turning their attention to One Store. For example, Epic Games filed a lawsuit in March this year against Apple's App Store's forced in-app payment policy (a payment method using the app market operator's payment system).

Regarding the domestic 'Telecommunications Business Act Amendment' that blocks forced in-app payment policies by Google and others, he expressed his candid opinion. CEO Lee said, "If only the clause preventing forced in-app payments is highlighted, the overall situation cannot be explained," adding, "Since the law aims to activate market competition, including equal access rights (to content) would have made the law more complete." He continued, "Since the companies benefiting from the prevention of forced in-app payments are large domestic companies like Naver and Kakao, not small and medium developers, there should be additional discussions on complementary measures that require these beneficiaries to take certain responsibilities." Equal access rights stipulate that value-added telecommunications service providers must provide apps to other app markets when supplying content to a specific app market.

CEO Jae-hwan Lee evaluates that One Store's business has now grown enough to realize 'economies of scale.' Despite some skepticism about the 700 billion KRW revenue target for 2025, he showed confidence, calling it a 'conservative' level. He also expects that the customized advertising business, in cooperation with IGAWorks, will contribute to profits. Currently, the monthly active users (MAU) have rapidly increased to 20 million from about 15 million in March this year.

Preparations for One Store's stock market listing, the first for a spin-off subsidiary from SK Telecom, are also underway. CEO Lee said, "The IPO has been pursued since last year and is progressing according to schedule," adding, "An announcement will be made soon, and since there are no listed companies with similar business models and financial structures to One Store in the peer group, various domestic and international content and platform companies will review it."

One Store is a domestic app market created in 2016 by the three domestic telecom companies and Naver to compete against Google and Apple. In July 2018, it lowered app commissions from the existing 30% to 20%, promoting a developer-friendly policy. When using its own payment system, the commission was only 5%. Thanks to this policy, it surpassed Apple App Store in game transaction volume in December of the same year, rising to the second-largest app market. It achieved 12 consecutive quarters of transaction volume growth until the second quarter of 2021, with transaction volume soaring to 550 billion KRW in the first half of the year. In June, Microsoft and Deutsche Telekom's investment company DTCP joined as shareholders, recognizing its growth potential.