[Asia Economy Reporter Kang Nahum] Kakao is drastically shifting its business direction from ‘digital innovation of traditional businesses’ to ‘targeting the global metaverse market.’ The company plans to break away from its domestic market-focused business, which has sparked neighborhood commercial district controversies, and compete head-to-head with global top-tier tech companies in the metaverse market.
◆‘Metaverse Strategy’ Unveiled to Coincide with Namgoong Hoon’s Appointment= According to Kakao on the 2nd, Namgoong Hoon, the designated CEO, along with other executives, is currently formulating Kakao’s new vision and business strategy, including metaverse initiatives, at the Future Initiative Center. It is reported that Namgoong will announce the future vision based on the outcomes from this center around the time of his official inauguration next month.
A Kakao official stated, "We will be able to explain specific business strategies after Namgoong Hoon assumes office," adding, "It is expected that future plans regarding the metaverse field, which Namgoong is interested in, will also be included."
Previously, CEO Namgoong said, "While operating the Future Initiative Center, I realized that our Kakao community possesses all three stages of digital world morphemes," and "Based on this, we began contemplating how to newly construct the metaverse world."
The three stages of morphemes Namgoong referred to are: stage one, text; stage two, sound and image; and stage three, multimedia. He mapped each morpheme to KakaoTalk (text), Melon (sound), KakaoPage (image), and games (multimedia). Now is the time to develop a platform that encompasses all of these.
◆Kakao’s Version of ‘Zepeto’ Is Ready= Naver’s metaverse platform Zepeto had 240 million cumulative users as of the third quarter last year. With 90% of users being overseas, it is regarded as a global success. Since 80% of users are teenagers, a potential consumer base, even greater growth is expected.
Although Kakao does not yet have a metaverse platform, it has long been advancing related technologies. Given that the metaverse shares similarities with massively multiplayer online role-playing games (MMORPGs), Kakao Games, which excels in game development and publishing, is expected to play a key role.
Kakao Games owns subsidiaries specialized in MMORPG development, such as XL Games, the developer of ‘ArcheAge,’ and Lionheart Studio, the developer of ‘Odin: Valhalla Rising.’ They have grown their game development and operation capabilities by servicing these popular games. Another Kakao Games subsidiary, Friends Games, has also developed and launched ‘Today’s,’ an NFT marketplace specialized for the metaverse.
◆Virtual Economy Based on ‘Klay’ Expected= Building a virtual economy, a core element of the metaverse, is not difficult for Kakao. This is because Kakao’s blockchain platform ‘Klaytn’ and its cryptocurrency ‘Klay’ demonstrate high usability.
When Kakao Entertainment turned iconic scenes from the popular webtoon and web novel ‘Solo Leveling (Nahongrep)’ into NFTs, Klay was used for transactions. Crust, a subsidiary responsible for the Klaytn business, recently announced plans to establish Klaytn as infrastructure for metaverse and GameFi (financialization of games). Additionally, KakaoTalk, as a single platform, boasts 45 million domestic users, which is advantageous for securing users when entering the metaverse business domestically.
Furthermore, Kakao Brain, Kakao’s artificial intelligence (AI) developer, is currently working on virtual human production technology using deep learning and the ‘Nickface Project,’ which creates virtual faces. Kakao Entertainment has also invested in ‘Metaverse Entertainment,’ a subsidiary of Netmarble F&C, actively engaging in discovering metaverse content.
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