Coway at the Starting Line... Will It Spark a New Wave in the 'Subscription Economy'?

[Asia Economy Reporter Moon Hyewon] Woongjin Coway is rebranding itself as 'Coway' and making a fresh start. The acquisition of Woongjin Coway by game company Netmarble is entering its final stages. Industry insiders are paying attention to the potential synergy between the two companies from different industries.

On the 7th, Woongjin Coway held an extraordinary shareholders' meeting at the Yugu factory in Gongju, Chungnam, and decided to change its name back to Coway, the name it had before being acquired by Woongjin Group. They also plan to approve the appointment of Bang Junhyuk, Chairman of Netmarble, Seo Jangwon, Vice President of Netmarble in charge of business strategy, and Lee Haeseon, former President of Woongjin Coway, as inside directors.

Netmarble signed a contract at the end of last year to acquire about 25% of Woongjin Coway shares held by Woongjin Thinkbig for 1.74 trillion KRW. At that time, Bang Junhyuk, Chairman of Netmarble's board, expressed his vision to apply Netmarble's expertise in big data analysis of users, artificial intelligence, and IT technology?accumulated through its gaming business?to Coway, aiming to enter the smart home subscription economy business.

Coway plans to expand the domestic subscription economy market, currently limited to general home appliances, to smart devices. Their ambition is to broaden the rental service area from household appliances such as water purifiers, air purifiers, and bidets to include PCs, TVs, and automobiles through IoT (Internet of Things) services. Recently, 'Xiaomi,' which connects various IoT products through a mobile platform ecosystem called 'Mi Home,' has been cited as a benchmarking target for Coway.

Netmarble has been aggressively investing in artificial intelligence development since 2014. In 2018, it established the Netmarble AI Revolution Center (NARC), a dedicated organization for AI technology, and recruited Dr. Lee Junyoung, who has researched AI and big data for 20 years, as the center director. They have filed 65 AI-related patents, with more than 15 already registered.

Woongjin Coway, the number one rental company, holds about 7 million accounts domestically and internationally. Its sales steadily grew from 2.3763 trillion KRW in 2016 to 2.5168 trillion KRW in 2017 and 2.7073 trillion KRW in 2018. As of the third quarter of last year, sales reached 759.6 billion KRW, and operating profit was 140.3 billion KRW, marking the highest quarterly performance ever. Last year's sales are expected to approach 3 trillion KRW.

Currently, Coway exports air purifiers, water purifiers, and other products to about 50 countries worldwide. It is building a strategic sales network centered on the Malaysian and U.S. markets and is accelerating entry into new markets such as Indonesia.

This content was produced with the assistance of AI translation services.