This document provides a quarterly trend report on the Korean social game market in Q3 2010. Some key findings include: - Simulation games continue to dominate the market, accounting for over 85% of profits. Aquarium games saw significant growth while Pet & Management games declined. - The market remains dependent on a few successful games in each genre. Individual game performance can significantly impact overall genre trends. - Sports and RPG games saw increased revenue and a strongly male-dominated user base with the launch of new popular titles. This shows targeting male users can be a viable strategy. - While simulation games have more female players, male users in some genres like sports and RPG had higher average spending. The

1. Korean Social Game Market
Trend Report
2010 Third Quarter (Vol.1)

2. 2
Korean SNG Market Trend Report
2010 Third Quarter (Vol. 1)
By Sung-Hwan Ahn
Rubicon Games Inc.
Editor’s Note
Unlike Facebook and other major social game platform, not too many about Korean
social game industry is revealed to the public. On one hand, it may be an “Asian courtesy” for
platform service providers to hide its customers’ private information from their competitors. On
the other hand, it may create an entrance barrier and suppress new developers from entering the
market. Nevertheless, believing in the fact that freedom of information is harmless to fair market
competition, Rubicon Games Inc. suggested Nate AppStore Open Social Team to share their
statistics and information as much as possible. Gratefully, Nate AppStore agreed upon revealing
more information for both domestic and foreign developers who are interested in publishing their
games in Korea. However, please note that stats were given in bundles of genre, due to privacy
issues. To find out more about Korean social gaming industry, visit http://blog.playrubi.com or
email info@playrubi.com or devsquare@nate.com.
Executive Summary
- Nate AppStore continues to accumulate more users. However, user increase rate has
been slowly depreciating since May and fluctuates throughout third-quarter.
- Nate AppStore’s revenue has been steadily increasing since its launch in September 2009,
with a big leap in May 2010. In the third quarter, however, the revenue increase has
been slowed down in August and bounces back in September.
- The performance of game genres is still heavily dependent on few successful games.
Mostly because there are not too many games in the market yet.
- Very exceptionally, sports and RPG games were strongly male-dominant with gender ratio
of 85 to 15. Sports and RPG’s revenue tripled and doubled respectively throughout the
third quarter, covering 10% of total revenue of the market. User loyalty was also strong
showing high ARPPU (Average Revenue Per Paying Users) and conversion rate from non-
paying users to paying users
- Simulation games (Pet, City Building, Farming, Aquarium, and Business Admin.) are still
most profitable, covering more than 85% of the total profit.
- More female than male users are playing simulation games with higher ARPU (Average
Revenue Per User), but when it comes to ARPPU, male users are paying even more.

3. Market Overview
Nate AppStore has grown steadily s
continuously increasing, exceeding three million users in
however, have gradually decreased since early May, and has been fluctuating during third quarter.
With the initial inflow of successful simulation games in May, the market has
increase in revenue. During third quarter, however, the
<Line graph 1: Accumulated and New User of Nate AppStore>
<Line graph 2: Total Revenue of Nate AppStore
3
Nate AppStore has grown steadily since it took off in September
continuously increasing, exceeding three million users in September 2010. New user inflow rate,
however, have gradually decreased since early May, and has been fluctuating during third quarter.
successful simulation games in May, the market has experienced a drastic
During third quarter, however, the revenue increase has become stagnant.
and New User of Nate AppStore>
<Line graph 2: Total Revenue of Nate AppStore>
September 2009. Users are
. New user inflow rate,
however, have gradually decreased since early May, and has been fluctuating during third quarter.
experienced a drastic
has become stagnant.

4. Dependence on few successful Games
Korean social gaming market is yet heavily dependent on few successful games. The
user increase rate, revenue, conversion rate, and even stickiness of a genre
with few major successful games.
makes it possible for individual games to
Stats for RPG, for example, show
during September with the introduction
users in just one month.
<Line graph 3: Revenue and number of
On the contrary, Pet &
approximately 200% decrease for two consecutive months
games but are not spending as much as they use to.
Management genre are raising avatars or pets*)
<Line graph 4 Revenue and number of
4
Dependence on few successful Games
Korean social gaming market is yet heavily dependent on few successful games. The
user increase rate, revenue, conversion rate, and even stickiness of a genre fluctuate
successful games. This is mostly due to the lack of games in the market, which
makes it possible for individual games to affect the overall market trend.
Stats for RPG, for example, show that user increase rate and revenue suddenly jumps
introduction of Friends Fighters, which accumulated more than
: Revenue and number of installs in RPG genre>
& Management genre experienced a drastic fall
200% decrease for two consecutive months. Users continue to install and play pet
games but are not spending as much as they use to. (*Please note that games filed u
Management genre are raising avatars or pets*)
Revenue and number of installs in Pet & Management genre>
Korean social gaming market is yet heavily dependent on few successful games. The
fluctuate in accordance
games in the market, which
that user increase rate and revenue suddenly jumps
mulated more than 60,000
experienced a drastic fall in revenue, marking
Users continue to install and play pet
Please note that games filed under Pet &

5. The latest management game
the only game in the genre that is
Pet, Pet Society was all released before June but is already experiencing a
due to lack of updates and management.
Happy Idol, all the rest of pet games are developed and published by foreign developers.
Successful localization and continuous manageme
<Line graph 5: Accumulated Installs of
<Source from Rubicon Games Statistic Team>
City building games are also
Again, the same problem is observed in the
dependence on Happy Town. There are only two
but even Street Stall King went
<Line graph 6 Revenue and number of
5
The latest management game Happy Idol, which was released in mid June, seems to be
in the genre that is steadily accumulating more users. FooPet
all released before June but is already experiencing a high
due to lack of updates and management. It is also worthy of notice that with the exception of
pet games are developed and published by foreign developers.
Successful localization and continuous management is thus a key factor to keep the game alive.
Accumulated Installs of Pet & Management genre>
<Source from Rubicon Games Statistic Team>
games are also experiencing a continuous downtrend in total revenue.
Again, the same problem is observed in the City Building game genre which shows heavy
. There are only two City games, Happy Town and
out of service as of October.
venue and number of installs in City Building (SIM) Games>
, which was released in mid June, seems to be
FooPet”, RockYou! Super
high churn rate, mostly
It is also worthy of notice that with the exception of
pet games are developed and published by foreign developers.
to keep the game alive.
a continuous downtrend in total revenue.
game genre which shows heavy
and Street Stall King

6. 6
Overall, the phenomenon implies that Korean social gaming market still has a big room
for many new games to penetrate, which is good news for new developers who are still hesitant
over entering the market. The trend also shows that users are willing to spend and quit at the
same time, thus demanding developers to continuously develop and update better games
regularly to maintain positive momentum.
The Rise of Male Users
Before few male-biased games became successful, the consensus of Korean social
gaming industry strongly believed that success of a game depends on how much they can attract
more female users. As a result, most of the games were female-biased, introducing cute graphics
and simple game plays. However, few games seemed to have taken the road not taken:
Homerun King, Baseball Wars, and Friends Fighters. These strictly male-biased games proposed
an alternative business model to many developers.
The user gender ratio for Sports Games is strongly male-biased. Homerun King is an
arcade type sports game whereas to Baseball Wars is a team management type game. Relatively,
Baseball Wars have a bigger entrance barrier since the game is statistics-based rather than visual,
unlike Homerun King.
<Picture 1: Homerun King game play> <Picture 2: Baseball Wars game play>

7. <Pie graph 1: Gender ratio Sports Games>
What is more interesting
revenue of Sports genre soared
the overall revenue slightly decrease
regarding the stats for ARPPU
period, which can be inferred that
there were more inflow of non-
<Line graph 7: Revenue & Number of
7
: Gender ratio Sports Games>
more interesting is the revenue model (See line graph 5). According to the stats,
revenue of Sports genre soared in August together with the launch of Baseball Wars
decreased along with the ARPU in September. N
ARPPU, the average revenue continues to increase during Aug.
hat spending users are becoming even more loyal to the game
-paying users during the period.
umber of Installs in Sports genre >
. According to the stats,
Baseball Wars. However,
along with the ARPU in September. Nevertheless,
continues to increase during Aug. – Sept
becoming even more loyal to the game and

8. <Line graph 8: ARPU of Sports Games
<Line graph 9 ARPPU of Sports Game>
Sports genre revenue continues to
September. It is significant in the sense that ratio of total user still
the fact that puzzle games are only earning 2% of the total revenue while covering quarter of the
user pool, sports games are highly productive. (No
payment system)
8
: ARPU of Sports Games>
ARPPU of Sports Game>
Sports genre revenue continues to incline, covering 9% of the total revenue of Nate
September. It is significant in the sense that ratio of total user still covers only 2%.
the fact that puzzle games are only earning 2% of the total revenue while covering quarter of the
user pool, sports games are highly productive. (Note that 12 out of 20 (60%)
of the total revenue of Nate by
only 2%. Considering
the fact that puzzle games are only earning 2% of the total revenue while covering quarter of the
12 out of 20 (60%) puzzle games have

9. 9
<Pie graph 2: Total Ratio of Installs and Revenue (July-Sept)>

10. RPG genre too, is showing a male
gender ratio, RPG revenue continue
the successful game Friends Fighters
compared with previous month.
battle game, which is strongly male
<Line graph 10: Revenue of RPG
It is observable that
increasing. In the broader perspective
closer look at the ARPPU, female users
phenomenon is also found in the Sports genre, thus female users
conversion rate from non-paying to paying user
spending just as much as male users.
<Line graph 11: ARPU of RPG>
10
RPG genre too, is showing a male-biased distribution. With three to one
gender ratio, RPG revenue continues to increase over the past three months. With the release of
Friends Fighters in early September, the revenue increases
previous month. Here again, Friends Fighters is a statistic
battle game, which is strongly male-biased.
: Revenue of RPG>
is observable that more users are becoming more loyal to the
perspective, male users are spending more on average but
, female users are paying just as much as male users.
phenomenon is also found in the Sports genre, thus female users general
paying to paying user to paying user but once converted, they
spending just as much as male users.
three to one male-dominant
se over the past three months. With the release of
ncreases more than 250%
Here again, Friends Fighters is a statistic-based martial arts
more users are becoming more loyal to the genre, with ARPU
n average but taking a
just as much as male users. Again, this
generally show smaller
once converted, they were

11. <Line graph 12: ARPPU RPG>
Overall, going niche by
users, conversion rate, and ARPU growing
developers will have more options to consider
Simulation Games Still Strong
Simulation games (Farming, Aquarium, City
Management) still covers the majority of the market share throughout
the user pool is just one-third
simulation games. (See pie graph
games incorporated payment system
adopted payment.
Among the simulation games, revenue of Aquarium genre soars while Pet
Management drastically falls. There are only two games filed under Aquarium genre (
and Sunshine Deep Sea), whereas Farming and Pet & Management genre have seven and four
games filed under respectively
September is almost equivalent
Moreover, when it comes to daily active
simulation games all put together. (123,130 to 117,803
Aquarium genre continues to accumulate
11
going niche by targeting male users is partially proven successful
users, conversion rate, and ARPU growing steadily. With bigger pool of male audien
developers will have more options to consider for their next game.
till Strong
Simulation games (Farming, Aquarium, City Building, Business Ad
the majority of the market share throughout third
third of the total users, almost 90% of the total revenue comes from
e graph 3 and 4) Moreover, 84% (16 out of 19
incorporated payment system, whereas only 37% (26 out of 70) of non
Among the simulation games, revenue of Aquarium genre soars while Pet
. There are only two games filed under Aquarium genre (
), whereas Farming and Pet & Management genre have seven and four
respectively. With just two successful games, Aquarium
equivalent to that of Farming and Pet & Management
daily active users (DAU), Aquarium genre exceeds all the rest of the
s all put together. (123,130 to 117,803). After taking the lead since May,
accumulate more DAUs and revenue throughout
male users is partially proven successful with number of
. With bigger pool of male audience,
Building, Business Administration, Pet &
third quarter. Although
of the total users, almost 90% of the total revenue comes from
19) of the simulation
) of non-simulation games
Among the simulation games, revenue of Aquarium genre soars while Pets &
. There are only two games filed under Aquarium genre (Aqua Story
), whereas Farming and Pet & Management genre have seven and four
two successful games, Aquarium genre’s revenue in
Management put together.
, Aquarium genre exceeds all the rest of the
). After taking the lead since May,
throughout third quarter.

12. <Pie graph 3: Total User ratio of
<Pie graph 4 Total Revenue ratio of
<Line graph 13: Revenue of Simulation Games
12
ratio of Simulation and Non-simulation Games>
ratio of Simulation and Non-simulation Games>
Revenue of Simulation Games>

13. <Line graph 14: Monthly Average DAU of Simulation Games
<Line graph 15: Monthly Average DAU of all Genre
Female Dominant, yet Male Users Show Strong Purchasing Power
If sports and RPG genre were male dominant, simulation games are favored by female
users. (See bar graph 1) Among the genres, Pet & Management and Business Administration
genre were especially female-
female-oriented. Regarding Business Administration
restaurant management, and others remaining were fashion boutique and public bathroom
management.
Revenue-wise, however, male users came much stronger in
ARPU, a segment of loyal male users were
genres. It implies that female users have higher co
male users have a segment of loyal users with
conversion rate.
13
Monthly Average DAU of Simulation Games
Monthly Average DAU of all Genres>
Female Dominant, yet Male Users Show Strong Purchasing Power
If sports and RPG genre were male dominant, simulation games are favored by female
(See bar graph 1) Among the genres, Pet & Management and Business Administration
-biased; most of the games filed under these two genres
oriented. Regarding Business Administration games, out of four games,
and others remaining were fashion boutique and public bathroom
however, male users came much stronger in ARPPU. Despite of the low
ARPU, a segment of loyal male users were spending more than female users in most of the
female users have higher conversion rate but with lower ARPPU whereas
a segment of loyal users with stronger purchasing power
Female Dominant, yet Male Users Show Strong Purchasing Power
If sports and RPG genre were male dominant, simulation games are favored by female
(See bar graph 1) Among the genres, Pet & Management and Business Administration
biased; most of the games filed under these two genres were
out of four games, two games were
and others remaining were fashion boutique and public bathroom
. Despite of the low
more than female users in most of the
lower ARPPU whereas
despite of the low

14. <Bar graph 1: User Increase of Simulation Games by Gender>
<Bar graph 2: ARPU & ARPPU of Simulation Games
14
<Bar graph 1: User Increase of Simulation Games by Gender>
of Simulation Games>

15. 15
Conclusion
History of Korean social game industry is rather short. It was only recently that Nate
AppStore celebrated its first anniversay in September, and not until 2010 3rd quarter that major
Korean portal sites such as Naver and Daum jumped into the market. However, tracing back the
accomplishments Nate AppStore has shown so far, the future of the Korean social game industry
looks bright and promising.
Nate AppStore so far grew using Cyworld as a leverage, which has 25 million user pool.
However it is slowly expanding its audience from Cyworld to NateOn messenger (35 mil.) as well.
Moreover, as major players are now launching their own platforms through various channels, the
market size and potential user pool continues to increase. Today social games are not only
established on SNS but also penetrating through Naver blogs (18 mil.), Naver Cafes (6 mil.), and
even micro-blogs such as Yozm (N/A) and Me2Day (2 mil). Thus Korean social gaming industry is
now holding more than 86 million potential user pool. Also taking into note that more than 15%
of the Korean population is smart phone users, social games now have various channels for
convergence and become more ubiquitous.
Overall, the Korean social game industry is yet a blue ocean and has just entered its
second phase of growth with market expansion. Also, since Korean users have been gradually
educated to spend on SNS over the past 10 years, it is likely that the paying habits from SNS
would trickle-down to social games without repulsion. And as the stats shows, Nate AppStore
has just begun to witness this trend with revenue steadily increasing. Competing platforms like
Naver and Daum are also likely to see this trend as more users accept social games. Together
with more inflow of quality games and developers, the market is assured to benefit both
developers and platforms.