South Korean webtoon companies aim for global takeover

As the author of a series that has garnered 1.2 billion plays, Rachel Smythe is one of the world’s leading webtoon creators. But in her native New Zealand, hardly anyone seems to know what she’s up to.

“If I go to a party, people will be like, ‘I don’t know what this is,'” said Smythe, whose graphic novel based on his ‘Lore Olympus’ series topped the list of New York Times bestsellers last year. “And when I tell them I got a job with an app that was founded in Korea, they’re like, ‘Rachel, this looks like a scam – are you okay?'”

Webtoons, comic books designed to be read on a smartphone, are South Korea’s latest cultural export to come out of Asia following the global success of K-pop superstars BTS and Netflix sensation Squid Game.

They are already big companies in Japan. In January last year, Piccoma, a Japanese webtoon subsidiary of Korean Kakao Entertainment, had monthly revenue of $96 million (€87.5 million), making it the second-largest non-gaming app. most profitable in the world. It was just behind TikTok, overtaking the YouTube app and Tinder.

Now, webtoons are entering the mainstream. All of Us Are Dead, a South Korean zombie apocalypse coming-of-age drama that began life as a digital comic on the Naver Webtoon platform, was the non-language show in late February. most-watched English on Netflix. Webtoons Kakao Itaewon Class, Moving and Dr Brain have been successfully made into TV series on Netflix, Disney+ and Apple TV+ respectively.

But Smythe’s experience illustrates how webtoons still remain unknown to many outside of East Asia, even as they garner a burgeoning army of young, non-Asian fans and target the US market.


One of the industry’s pioneers is Kim Jun-koo, a software engineer who became frustrated with the slow death of traditional Korean manhwa comics in the wake of the Asian financial crisis in the late 1990s.

His webtoon platform Naver Webtoon, which he founded in 2004, is now the largest in the world, with 750,000 creators and 82 million monthly active users. Gross merchandise volume, a measure of the amount of money users spend in the app, increased from $492 million in 2019 to $900 million in 2021.

“A webtoon is not a digital version of a comic. It’s a comic that was created digitally,” Kim said. “In Korea, comics were disappearing, it was an example of a dire situation leading to innovation.”

Major platforms such as Naver Webtoon and Kakao Webtoon provide tools for creators to create and upload webtoons for free, providing audiences with a near limitless range of content.

“There is no genre limitation in webtoons, and genres are very diverse,” said Jang Min-gi, a professor of media communication at Kyungnam University. “Users can see them on the go, access them very quickly, and view them in a very short period of time.”

With hundreds of thousands of creators and tens of millions of monthly readers, webtoon companies are able to deploy a range of monetization strategies. Some use a YouTube-like model to attract large audiences with free content, others a Netflix-like model to attract paid subscribers for the most popular series, or a “microtransaction” payment model favored by gaming apps. .

“The business model has now evolved further to require readers to pay for future episodes if they want to read them immediately. If the story is fun and compelling, readers won’t want to wait,” Song Jin-woo said, responsible for operating the platform. management of Kakao Entertainment, which operates Kakao Webtoon.


Analysts and industry leaders describe a “virtuous circle” in which successful adaptations in other media attract legions of international fans, who then turn to webtoons as they search for the source of their stories and favorite characters.

“It’s expensive to produce movies and soap operas, especially fantasy movies, while making comics requires little money but can have beautiful visual effects,” said Park Jeong-seo, business manager. Webtoon at Kakao Entertainment.

In addition to exporting their own audiences to foreign platforms, Korean platforms have taken to “importing” foreign audiences through deals giving them access to what Kim Jun-koo describes as “super IP”.

In 2019, Kakao Entertainment entered into a collaboration with American comic book publisher DC Comics. Naver Webtoon has entered into partnerships with DC, rival Marvel, Archie Comics, and Hybe, the South Korean company behind BTS.

Both platforms have built loyal followings in Europe, Latin America and Southeast Asia. Naver Webtoon, which offers services in French, Spanish and German, is launching its own European company, while Kakao Webtoon launched in Thailand and Taiwan last year.

“We are now focused on expanding into the United States, which is the largest content market in the world. To be successful there, we need to create webtoons that suit American tastes,” said Park Jeong-seo of Kakao Entertainment, which last year acquired Los Angeles-based webtoon publisher Tapas Media as part of a a deal worth $510 million.

US users

Naver Webtoon’s 14 million US users made up 17% of its global readership, compared to 25% in South Korea, 15% in Southeast Asia, 8% in Japan and 4% in Europe.

Last year, it completed the $600 million acquisition of Canadian company Wattpad, a user-generated writing content platform with its own 94 million users.

As well as giving the company access to new users in overseas markets, executives believe the purchase will help them improve the quality of their designs by partnering with up-and-coming illustrators.

“There are two ways to tell stories – a visual and a written one – so if we bring them together, it will only be stronger,” said Aron Levitz, president of Wattpad.

Naver Webtoon CEO Kim Jun-koo said that while his company’s ambitions are supported by its deep-pocketed parent, Korean web portal Naver, “we plan to have more aggressive acquisitions, and if we have need for larger investments, we plan to review an IPO or external financing.

As webtoon platforms target American analysts, there have been questions about whether Korea’s “digital snack culture” would resonate with an American audience.

But executives and designers trust a group of consumers they say is routinely ignored: young women and teenage girls. Among US users of Naver Webtoons, more than 70% are under the age of 24. Young women make up 80% of Wattpad’s readership.

It was this demographic that propelled Rachel Smythe’s “Lore of Olympus” webtoon based on the Greek romance myth of Persephone and Hades to the top of the digital and physical bestseller charts.

“Young women are so passionate and have so much to give, but often the things they love are insulted and looked down upon,” Smythe said.

“But it’s an app where the things they love are celebrated and treated with respect. I think that’s why it works so well.” – Copyright The Financial Times Limited 2022

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