In Seoul, a line of bus passengers and their cell phones during the coronavirus COVID-19 pandemic. Image – Getty iStockphoto: Wonseok Jang
By Porter Anderson, Editor-in-Chief | @Porter_Anderson
South Korea’s Kakao Is Also a Buyer: Radish and Tapas
In January, as you’ll recall, it was announced that the Toronto-based Wattpad was to be acquired by Naver, a South Korean Internet search engine conglomerate, the home of Webtoon, a digital comics platform.
In its messaging overnight (May 10), the Canadian company has reiterated its earlier citation of the acquisition being a cash and stock transaction valued at more than $US600 million. It also restates that Wattpad’s co-founders Allen Lau and Ivan Yuen will continue their direction of Wattpad, and that the company will remain based in Canada. Lau, who is CEO, is to report to the Jun-koo Kim, the founding CEO of Webtoon, the production wing of which, Webtoon Studios, has worked with the Jim Henson Company; Crunchyroll; Vertigo Entertainment; and Bound Entertainment.
Wattpad is expected to grow its teams by nearly 50 percent in 2021, the company says, adding close to 100 new roles in engineering, marketing, content, and other parts of the company.
Predicting that the two Naver brands—Wattpad and Webtoon—will have a combined monthly audience in excess of 166 million people. Wattpad as a standalone has some 90 million active monthly users, most of them millennials and Generation Z, many of whom Naver clearly sees as strong consumer candidates for its comics platform.
Wattpad says that 5 million people of its monthly cohort of 90 million are the writers. And the balance, 85 million readers, would look good to just about any audience-based storytelling enterprise.
The Circling Competitors
What many will be watching now is the new kid on the serialization block—Amazon’s Kindle Vella platform—to see if Seattle can make a creditable run at Toronto and Seoul’s avid users. Can it leverage that words-to-screen development pathway using its own Amazon Studios production power?
While we wait to find out, another South Korean company, Kakao Entertainment is confirmed to be the new owner both of Radish—a deal reported by Jill Goldsmith at Deadline to be valued at US$440 million—and Tapas Media for another US$510 million.
In news release copy issued this morning (May 11), it’s made clear that Kakao has had a “longstanding partnership with Tapas and Radish,” holding minority ownership in both.
It would seem, at least today, that the South Korean market is very keen on controlling the internationally growing serialization-platform space.
Writing for Reuters Seoul about Kakao’s moves, Joyce Lee points out, “Kakao Entertainment has seen success with its online-based Web cartoons or ‘webtoons’ at home and in Japan, with Kakao-backed Piccoma becoming one of Japan’s highest-grossing mobile apps outside games.”
And that, of course puts Kakao into what may become a head-to-head slugfest with Naver’s Wattpad-fortified Webtoons.
‘To Fuel On-Screen Hits’
Seong-Sook Han
In executive statements on the completion of the Naver-Wattpad acquisition, Naver CEO Seong-Sook Han is quoted, saying, “Through this acquisition, it’s expected that the synergy between Webtoon and Wattpad will be even greater. Gen Z around the world have fallen in love with storytelling platforms like Wattpad and Webtoon.
“With a growing international user base of Gen Z readers and writers on Wattpad and Webtoon, combined with hundreds of millions of incredible stories to fuel on-screen hits, Naver is quickly becoming an important player in the global entertainment and content market.”
Jun-koo Kim
Webtoon chief Jun-koo Kim says, “Wattpad has redefined writing in the digital era, creating new ways for independent authors to build an international audience and make money.”
And for Wattpad, Lau says, “We founded Wattpad with a vision to entertain and connect the world through stories. By joining the Naver family of companies, we’re continuing that vision, with more resources and expertise to grow our global community and help writers everywhere achieve their dreams.
Allen Lau
“Alongside Naver and Webtoon, we’re positioned for faster growth and continued innovation to support writers and transform publishing and entertainment around the world.”
Much of the overnight messaging from Toronto is a victory lap, Wattpad listing, for example, its creation in March of Wattpad Brand Originals to house its own self-development shop for television, film, and other entertainment products based on content coming off the platform. As we reported last month, Wattpad Studios is involved now in its first Netflix International Originals production, Ariana Godoy’s bad-boy romance A través de mi ventana (Through My Window).
Of interest to writers is Wattpad’s point that its Paid Stories program has earned selected writers an aggregate of more than US1 million.
But monetization may need to become a more aggressively pursued aspect of Wattpad’s work, with Amazon’s Kindle Vella serial-writing platform headed for a format in which writers and the company split the take on tokens bought by consumers to read the content.
Lau and Yuen have not, until now, had to face the level of North American-based competition that Amazon can leverage with its formidable retail outreach and algorithmic accomplishment. This could prove a useful moment to have been acquired by a major player like Naver.
More from Publishing Perspectives on Wattpad is here, more on mergers and acquisitions is here, more on the Canadian market is here, and more from us on books to film is here.
More from us on the coronavirus COVID-19 pandemic and its impact on international book publishing is here.