NCSoft Bewildered by the Resurgence of 'Leadership Restructuring' Debate

The Korea Game Society Foresees Issues at the General Meeting
"Business Structure Solidified by Family Management"

The Korea Game Society has announced it will raise concerns about family management at the NCSoft shareholders' meeting. The claim is that the company has failed to move away from a business structure reliant on the 'Lineage' intellectual property (IP) and loot box items due to long-standing family management. As this controversy reignites within the industry, NCSoft finds itself in an awkward position.

Wi Jeong-hyun, president of the Korea Game Society, plans to attend NCSoft's regular shareholders' meeting on the 29th as a shareholder and point out issues related to family management. Afterwards, he intends to hold a press conference to share the problems raised at the meeting.

The society criticizes NCSoft's entrenched business structure as being intertwined with family management. They argue that to break away from a business model that relies on a single IP, Lineage, and monetizes through loot box items, a generational change in management is necessary.

[Image source=Yonhap News]

Currently, at NCSoft, Yoon Song-i, the wife of CEO Kim Taek-jin, serves as president (CSO - Chief Strategy Officer), and Kim Taek-heon, the CEO's younger brother, serves as senior vice president (CPO - Chief Publishing Officer), both as non-registered executives. Both Yoon and Kim have been with the company for nearly 15 years. Yoon has been leading NCWest, which oversees NCSoft's North American operations, since 2012, while Kim has been CEO of the entertainment subsidiary KLEVV since 2020. NCSoft is unique in the gaming industry for such family management.

Wi Jeong-hyun, a professor at Chung-Ang University and head of the Korea Game Society, stated, "NCSoft has tamed users by heavily sweetening the Lineage IP with loot box items," adding, "Vice President Kim led the business model, and CEO Kim Taek-jin neglected it because of family ties." He further added, "President Yoon has overseen six consecutive years of losses at NCWest but has not taken responsibility."

Family management at NCSoft is not a recent issue. However, the society raised the problem because they believe the family members are expanding their roles without taking responsible management. They also claimed that the same issue was raised at the 2021 shareholders' meeting but no changes have been made.

NCSoft recently established a new North American subsidiary, NC America LLC, with Senior Vice President Kim appointed as its CEO. NCWest will focus on servicing the Guild Wars IP and local strategic investments, while the new subsidiary will handle the service of the company's main games in the North American market.

NCSoft appears to be in an awkward position. The society brought up issues unrelated to this year's shareholders' meeting agenda. The agenda includes ▲approval of the 2022 financial statements and consolidated financial statements ▲appointment of outside directors ▲appointment of audit committee members ▲approval of director remuneration limits. An NCSoft representative said, "Under an open R&D policy, we are pursuing platform and genre diversification," adding, "To target the global market, we are cooperating with Amazon and pursuing a two-track strategy for the North American business."