South Korea’s top internet company, Kakao, and leading game developer, Com2uS, are reportedly downsizing their metaverse teams due to significant losses incurred by their virtual world platforms in the first half of 2023. Here are some key points:
- Com2uS, a major mobile game developer with a revenue of $536 million in the previous year, has downsized its metaverse division, although specific details about the staff cuts have not been disclosed.
- Com2uS launched its metaverse platform, Com2Verse, on August 1, 2023, but the business arm behind it reported an operating loss of approximately $6.2 million in the first half of the year.
- Colorverse, another South Korean metaverse company, which is owned by Kakao’s gaming subsidiary Kakao Games and affiliate Neptune, conducted layoffs earlier in the year and reported losses of $8.6 million in the previous year.
- CyTown, a South Korean metaverse platform launched as a revamp of the once-popular local social media service Cyworld, shut down after just a year of service, failing to attract users.
- A survey conducted in South Korea revealed that only 4.2% of citizens regularly use metaverse services, with a broad interpretation of the term “metaverse” that includes popular games like Minecraft, Roblox, and Animal Crossing.
- Meta (formerly Facebook) also faced significant losses in its metaverse division, Reality Labs, with losses totaling $13.7 billion.
- China’s Ministry of Industry and Information Technology announced plans to establish regulatory standards for the metaverse in an effort to become a world leader in the sector.
Kakao and Com2uS have not responded to requests for comments on this matter.