NCSOFT Corporation Essay

decision maker SUMMARYNCsoft had achieved massive victor and brand recognition after it had launched its sign supports like pipe occupation 1, Lineage 2 and Guild Wars. But since so the tastes of its guests had been gaining diversity, t here(predicate)fore, the family strikeed to look expose for ways to fulfill the aim for its productions. The confederation later excessively developed former(a) products within its round-eyed product portfolio to emergence its customer base and to a fault to expand its companion to acquire chunks of commercialise sh be. Play NC was also bingle of the products it had launched which gained little succeeder, virtu solelyy negligible. Since then, the go with has been focusing on its key issues which were also considered by its CEO. The rootage issue related to maintain the top opinion of the keep guild in the leading plucky commercialise place.For this, the company needfully to expand, especi tout ensembley by getting curr ent subsidiaries in different parts of the world where it had not antecedently commercializeed its products. The companys second to the highest degree important issue is to takingsmove the world(a) aspiration coming from the gaming constancy and also separate related industries, which might threaten NCsoft indirectly. The company involve to get to customer orientated products that feature their personal lives, so that they ar attached to the product and to the company itself. The company necessitate to meditate a globalization st valuategy. They need to increase its customer base. They also need todiversify to increase the betray of its offerings and by including elements that emotionally attach the customers to its products, NCsoft could fulfill its long stipulation daydream of bonnie a leading hoydener.CASE OVERVIEWNCSOFT, founded in March 1997, launched its outset feisty with the name of Lineage in September 1998. Lineage, was Koreas commencement exercise-y ear role playacting granulose. Although, NCsoft, began as a systems integration business, but currently it was transformed into a full game company. After the release of the premiere game, it gained a lot of victor and was soon listed on the Korean inventory Exchange. Just after its creating in 1997, NCsoft was earning about KRW5.5 billion. It was only in 2007 that its revenues change magnitude by 170 times and its nation increase from just 17 to 16,000.This case presents us with a contribution of NCsoft in the Korean playing period market. NCsoft had faced many challenges and was yet to face. Since the year 2000, the PC game market has declined by over 30%. Also the mobile game market began to experience declining yield rates. away from this the video game market experient negative feature riseth in the year 2004, due to economic stagnation. Nevertheless, the Korean game market started to show high annual growth rate of around 50%. By 2006, NCsoft had earned its 43% o f its revenue from its afield market. The company had an advantage of a first mover in the initial years of its operations in the gaming industry. However, this was no longer its first mover advantage. With the advent of sassy technologies, development of various profit models, diversification of accounting methods and building an online platform for online games, the company is straight forced to reinvent smart ways to reach the market.CASE QUESTIONSNCSOFT has a great growth potential both inside and outside of Korea. The president of the company is face a numerate of issues. As the founder of the company, he wants to maintain a strong prospect in the Korean market. He wants to find out how to diversify into the global market in the area of, for example, passing(a) games. He wants to get it on with the negative perceptions that have been developed in the minds of many people regarding the sideeffects of playing online games. Also the company wants to formulate strategies to counter attack the contest that is coming from competitors developing digital-content online games.1. MAINTAING ITS TOP POSITIONNCsoft has achieved mastery in the gaming industry and maintained its number 1 stick in the Korean market for a long period. It has released a miscellanea of gaming services such(prenominal) as, Lineage 1 and 2, massively multi actor online role-playing games, weathervane and sword and also an early(a)(prenominal) casual games. The company has developed globally and has grget in diversity within its customer base. The company had so far maintained its top position in the Korean gaming industry. However, it was still needed to raise the quality of its gaming services to gibe the changing expectations of its people and also mitigate the competition coming from the global market. value drivers?One of the ways for the company to maintain its top position was to occupy the recessions in the game industry. For this, the organization needs to focus on i ts core capabilities and capitalize on them. So far the company had achieved success in the area of digital content company. The company needed to grow its business through the integration of wired and wireless networks to sustain a global online development and publishing company. Since its inception, NCsoft was differentiated in the perception of its games. They pore on, to make the lives of the customers more joyful and make them a part of their fun culture. The company needs to introduce radical games into the market to boost increase its market parcel. It is known that online games were overtaking to create a nearly distance potential because they were net based.The company needs to further expand in this area by targeting niche markets. NCsoft also had the dream of becoming the worlds scoop digital content company and had three major mottos, Fun, Creativity and Quality. The company needs to expand but it also needs to formulate such strategies and positioning plans that prevent stopnibalization of the companys other happy products. It has been seen that a brisk market within the gaming industry has been rising. This was the development of game portals for the people of 30 or above and also some other casual games which were very popular with the people from all the ages, including theelders and the children. NCsoft eject also target this area to maintain its brand image and top position not only in Korea but in the global market too.2. MITIGATING THE WORLD COMPETITIONNCsoft was now giving considerable attention to the emerging competition that was going to increase in the distant future day. It was known that the future competition in the gaming industry, especially in the online games area would not be just dependent upon the games of other competitors. The competition was about providing the entertainment. bulk are beginning to bet for games on the net income. Therefore, NCsoft needs to prepare itself for competition with other onl ine companies, such as portals, communities and shopping malls. The online service of the company go forth not help the company survive in the future purlieu of the competition. The company needs to introduce more and more games to survive in the online environment, where exploiters have a limited time to use the internet.The online games on the internet can be described in various forms. These will accept all such content which wills entertainment to the customers. Most important on with this is that the company needs to launch such revolutionary games that will provide its customers the true perceived value. It could launch other products just like Lineage 1, Lineage 2 and the Guild Wars because of online games the customer was not just a customer but it is now considered as an asset. Therefore, the company needs to hope the Porters Five forces model to look at the emerging competition and analyze its position. The company should conduct this analysis when ingress new mar kets. The company needs to examine the micro-environment as well as its macro-environment, in the first place entering new markets.When the company has analyzed the new markets, especially the niche markets where it is planning to penetrate, they should expand on their core competencies and expertise and the areas where the company has achieved improvement to create a competitive advantage and sustain it for the long term. NCsoft has ceaselessly ruled the online game market in Korea, but since the Internet had appeared, most of the companies were transformed, to online gaming companies and first movers appeared in different fields. Everyone was looking for fully realizing the new market potential coming out of the online games. NCsoftwas also one of them. From all of this, NCsoft came to enjoy brand recognition in the year 2007.3. DIVERSIFICATION OF ITS plot of ground OFFERINGSThe company began in 1997 and since then the company has focused on adding new elements and updated whe n it first launched Lineage in 1998. The company has focused emphasis on the games as a work of art which was completed over some(prenominal) sessions of trimming and molding done through many hands. The main motor of NCsoft was not just to invest its capital in the business and experience a required rate of return on that investment, but the company ever wanted to and had examined its all new games to pick up what areas were fall short of the highest standard of quality. Since the beginning, the company has always been criticized for its dependence on the success of Lineage alone. Looking at its saucer-eyed product portfolio, the goal of the company of becoming a global company in the game industry it does not match.Therefore, later NCsoft had diversified and had increased, a new product to its simple product portfolio. The name of this product was play NC. This product provided a number of games, but its performance was not good. But still NCsoft has been focusing on develo ping new products through most of its subsidiaries. Garret brothers have accustomed NCsoft the title of becoming the next-generation online game. NCsoft needs to focus on diversifying its portfolio further. It needs to identify niche markets and penetrate its products in those markets. This would not only increase the market share of the company, but it would also give the company opportunity to accommodate the most leading players in the game industry.The CEO of the company, T. J. Kim himself enjoyed playing games and he had also spent sleepless nights playing these games just like his own customers. This was all due to the hard work of developers of NCsoft. They always tried to send their complete efforts and souls into the development of the games which always was a NCsofts advantage. The company needs to use these elements and the element of aiming for perfection to leave its competitors behind and diversify into new overseas markets.NCsoft needs to now look further than just generating revenues. It should search for new avenues to diversify its games in order to cut the completionand remedy monetize its products throughout the world. NCsoft needs to formulate a monetization outline to create a new strategic advantage. It needs to create games that are more addictive. People should feel that the games have been developed keeping in mind their personal lives. The unpredictability of the gaming industry is the only primer coat why diversification should be on high on the game developers side.The company on the other hand needs to also search areas where its business has grown to the maximum potential. These are the areas from where the company can think of further diversification into different areas. Diversifying into new areas does not scarcely mean increasing the revenue for the whole business. It also means step-down costs by achieving economies of scale in the business. NCsoft can acquire new subsidiaries in different parts of the world where it wants to promote its most successful games. This could be done for all online games or internet based games.The company has a very good opportunity to diversify into the area of casual games. Casual games are basically a type of video games which could be played by a huge audience at the alike time. The rules required to play these games are simple and are different from one another which distinguish these games from one another. These are simple games and not so a lot tough like the other hardcore games. These types of games normally play on the personal computers that have internet on them. But now these types of games are becoming popular on mobile phones and game lockers as well.4. GLOBALIZATION OF NCSOFTS PRODUCTSIf we look at the gaming industry in Korea, it is always seen that active marketing of the online games in overseas country has always contributed to the development of the online game industry. This was also proved by the fact that a forecast showed that the expor t market share of online games would exceed 82% among all other export games that are sold overseas. This online game industry was further expected to develop in the areas of various profit models and diversification and accounting methods. These online games were then beginning to be exported to Japan. These online games occupied 80% of Korean game exports.So on with the use of its superior technology and wide straddle of offerings, NCsoft had grown into a global online game company. It had entered countries such as China, Japan, Taiwan, Thailand, atomic number 63 and the United States. The most important thing to note about NCsofts globalization strategy is its speed. The company should adopt a different honorarium policy with regard to country to country, despite its domestic payment policy based on monthly charging fee scheme.NCsoft had promoted its first role playing game, Lineage, in the world market. It had signed a licensing contract with a Chinese based company names as Gamania. This game was then launched in Taiwan with the name of Tiantang. The company needs to also develop new product offerings and promote those products through other licensing contracts with other companies including Japan, China and America.It has been seen that the major contributor in the success of NCsoft, so far in its positivity is through its game Lineage 1 and Lineage 2. The company has other games that are not much successful in these markets. Therefore the company has the opportunity to win its foreign users hearts by differentiating its other games and update their previous versions in these markets to win margins and create brand recognition.A abundant portion of the world market today is occupied by the colonnade games industry, video games industry and also the console table games industry. Although these industries, except the video games industry, are not a direct threat to the online games industry, but still they could become a very credible threat in the future when the console gets connected to the online games. Therefore, it is becoming more and more important for the online games industries to prepare strategies against the console game makers for the future and to also develop such content in their games so that they have a very strong hold of their future.Apart from this, Microsoft has established a center known as an online game change center in Korea. It has also announced that soon it would be commit in it about 100 million dollars and will be going to put extra efforts in the online game relatedtechnologies. Therefore, the company needs to develop strategies for its future so that it could remedy its over-dependence on the heavy user based MMORPGs and also to pursue its globalization industry.The working class of the personnel mingled in the manufacturing of console games is ended when a game has been purchased and installed. The transaction ends here. However, the task of the personnel involved in the online game indus try starts right here and this stage provides an opportunity for online game companies, like NCsoft, to provide customer oriented services with respect to each individual country and market characteristics.5. dealing WITH NEGATIVE PERCEPTIONS & SIDE EFFECTS OF PLAYING ONLINE GAMES.The negative perceptions regarding playing games online could be dealt by counseling the parents of young children. They should be motivated by say them about the positive effects that online games could bring to children, such as difficulty solving skills, logic, hand-eye coordination, spatial and fine motor skills, resource management, planning, logistics, multitasking and managing multiple objectives. condition all of these benefits the parents could be motivated and their wrong perceptions regarding playing online games could be well removed. Also, they should be guided that excessive use of anything would surely be harmful, therefore, children as well as the adults should divide their time between leisure and other activities.CASE SUMMARY/CONCLUSIONThis case study presents us with the success story of NCsoft as the leading game company in the online game industry. The case focuses on how it emerged from Korea, as a systems integration business and becoming a full gaming company. It diversified its simple product line into a number of successful products after the release of Lineage 1 & Lineage 2. The company now wants to diversify its products further in other overseas markets. It is looking for niche markets to target them with its those games that have not gained much popularity in other markets.The company also will have to formulate a new globalization strategy to meet its long term goal of becoming the worlds leading game player and promote its brand. The company also needs toformulate strategies to overcome the competition coming from other online game players. It will also need to deal with competition coming from console game and video game developers. Ncsoft needs t o develop strategies and perform detailed five forces analysis before entering the new world markets.One of the areas where the company had the opportunity to develop and create its market is the area of digital media gaming. The company could occupy this segment of the market also. It could develop a variety of product offerings in this area and produce the sales of this segment to churn a bigger market share of the global gaming industry. The company also needs strategies and their immediate death penalty to maintain its top position in the world market. The company can do so by making its games more thrilling, joyful and realness based. They should include such elements in their games that reflect the personal lives of the people. Finally, they should also give people complete guidance regarding the positivity created by playing these internet based games.