NCsoft CEO Kim Taek-jin |
By Kim Tong-hyung
Staff Reporter
South Korean online game companies have been grabbing Asian markets on a scale and speed that has few parallels. Their stories in North America and Europe, however, have been quite the opposite.
Last week, NCsoft, the country's largest online game publisher said it will reorganize its non-Asian operations, consolidating its North American and European branches at its new Seattle headquarters, which might be named ``NCsoft West.''
However, the announcement has strengthened speculation that the company is close to shutting down its game studio in Austin, Texas, which had been the center of its U.S. business until now, and completely severing ties with Richard Garriott, an iconic American game developer who didn't look as magical to the Koreans.
Earlier this month, NCsoft fired 21 employees from its Austin office, saying that the branch would no longer be committed to developing casual games and will concentrate on multi-player role-playing games (MMORPG).
An NCsoft spokesman denied that a decision is immediate on the fate of the Austin game studio. But recent comments by Chris Chung, who will head NCsoft's new Seattle office, to Korean reporters suggest that the discussions about pulling the plug on the Austin studio are real.
``For now, the plan is to leave the Austin studio as it is,'' said Chung, adding that Garriott is currently on a temporary leave of absence.
``Whether the Austin studio will contribute to the business of NCsoft for the next five, ten years is certainly something to talk about,'' he said.
NCsoft remains ambitious about its U.S. business, with Chung declaring that North American operations will account for at least 50 percent of the company's revenue in the next three to four years. That is quite a bold statement, since North American sales accounted for just about 17 percent, or about 54.6 billion won, in 2007.
NCsoft reported an annual drop of 25 percent in operating profit and a 42 percent drop in net income for the second quarter of this year. The company's popular game titles, ``Lineage,''' ``Lineage II'' and ``Guild Wars'' saw drops in sales, while ``Tabula Rusa,'' a product of the Austin studio that is now proving to be a mega-flop, was the weakest performer among the company's games.
There are also speculation that the company could decide to discontinue Tabula Rusa, a result of an expensive, six-year project led by Garriott, soon.
NCsoft set up the Austin studio in 2002, assigning its project to Garriott and his brother Robert, who received stocks worth 14 billion won each for the job. At its peak, the Austin operation hired 300 employees, making it the largest foreign operation of a Korean info-tech company. However, the failure of Tabula Rusa might prove to be the branch's eulogy.
thkim@koreatimes.co.kr
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