Late Success in Chinese Market...Potential Dispute Over Development Performance Rewards
Nexon appears to be deeply concerned despite the "record-breaking" success of 'Dungeon & Fighter Mobile,' developed by its subsidiary. Recently, Neople, the development subsidiary behind this game, faced turmoil over wage increases and performance bonuses. As the game gains attention, the entire group faces an increased risk of disputes over performance rewards.
According to industry sources on the 4th, Nexon has a compensation system that distributes a portion of operating profits to developers for two years after launching a new title. Although the original 'Dungeon & Fighter' game was first released in 2005 and is now considered an old IP (intellectual property), the mobile version developed by Neople in 2022 is classified as a "new release."
'Dungeon & Fighter Mobile' is currently enjoying a successful run in China. According to app market research firm Sensor Tower, the mobile game generated approximately $270 million (about 370 billion KRW) in revenue in the Chinese market within one month of its release in May. This figure surpasses the cumulative revenue earned in Korea over two years and three months. There are even expectations that this single game could achieve trillion-won scale sales within the year.
If the game had been released first in China in 2022 or simultaneously in Korea and China, Neople’s developers could have received greater compensation. However, industry insiders say that due to the two-year release gap, it has become difficult to expect commensurate rewards at the initial launch stage.
This year, Neople experienced labor disputes over wage increases and performance bonuses. Despite Neople accounting for 70% (3.8134 trillion KRW) of the group’s total operating profit of 5.4099 trillion KRW over the past five years, claims arose that appropriate compensation had not been provided. The dispute nearly escalated to a strike, but an agreement was reached after the company partially accepted the union’s demands. The agreement reportedly includes a certain level of wage increase, a bonus payment of 7.5 million KRW, and a company-wide overseas workshop in the fourth quarter.
Given the "record-breaking" success of Dungeon & Fighter Mobile in China, it is highly likely that Neople’s developers will demand commensurate compensation again next year. In fact, during the recent agreement process, the Neople union emphasized the game’s top sales ranking in China to actively highlight Neople’s contribution.
Nexon’s concerns are also deepening. As the group’s overall performance is expected to improve due to this success, employees across the group may increasingly demand rewards. An industry insider said, "While Neople’s role in Dungeon & Fighter Mobile’s success is significant, since sales and operating profits are recorded as consolidated results, the headquarters and other subsidiaries are also likely to expect performance rewards. Especially since Nexon has focused on maintaining balance among its subsidiaries?agreeing on an average wage increase rate of 6.3% across all development subsidiaries?the concerns will only grow."
A Nexon representative stated, "We are striving to provide compensation that reflects the hard work and achievements of our developers."
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