Report: Korean game market to surpass $2 billion in 2007

PC, casual, and mobile games will be the driving forces behind the increase, according to market analysts Pearl Research.

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Online PC and mobile games, and especially so-called casual games, will push the South Korean gaming market to more than $2 billion in 2007--a rise of about 18 percent from its current size of $1.7 billion, market-research firm Pearl Research announced today.

A new report from the San Francisco-based firm said that South Korea's availability of PCs--including the prevalence of home computers, high-speed Internet, and cybercafes--will foster the expected increase next year. But that's assuming the effect of software piracy or rising game-development costs on the Korean game market are kept to a minimum, said the firm, which studies emerging game and entertainment markets.

Easy-to-play, easy-to-learn casual games currently make up about 30 percent of the video-game market in South Korea. With 79 percent of South Korean households owning at least one computer, PC gaming is the largest sector of the country's gaming industry.

The second-largest sector of the country's industry--mobile gaming--is also the fastest-growing, the firm said. Expected to exceed $275 million next year, mobile gaming will grow thanks to "ubiquitous" marketing and a strong selection of titles. Console gaming is the smallest sector, but the releases of the Sony PlayStation 3 and Nintendo Wii and the availability of more online-enabled games will boost its presence.

Despite South Korea's relatively small land area--about the size of the state of Indiana, according to the US government--the country has a dense population and burgeoning game industry. The strength of the country's game industry is larger than that of neighboring China, whose market, despite possessing the world's largest audience, is well regulated by the communist government.

In March, Pearl Research predicted that the Chinese game market in 2006 would exceed $760 million. In 2009 it will rise to about $1 billion, according to the firm--half of South Korea's predicted figure for 2007.

"One of the key differences between South Korea and China is income level," Pearl Research spokeswoman Allison Luong told GameSpot. "China is still an emerging economy with annual urban income levels of $1,300, whereas South Korea's annual income levels approximate $16,000."

But expect that gap to narrow in the future, she said. "China's games market is also growing rapidly," she said, "and because of its growing affluence and large population base [it] is expected to exceed Korea in the future."

Today's good news on South Korea comes after a flurry of negative reports late last year that put the country under the spotlight. Most prominently, in June 2005 a man collapsed and died after a prolonged, 50-hour session of World of Warcraft, prompting the South Korean government to begin offering welfare programs that treat online-gaming addiction.

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