Naver Forms 'Alliance' with Big Hit, Targets Global 'Generation Z'

BTS

[Asia Economy Reporter Bu Aeri] After making headlines with its acquisition of the world's largest web novel platform 'Wattpad,' Naver has solidified its ambition to grow into a global entertainment company by forming an alliance with BTS's agency Big Hit Entertainment just one week later.

In particular, Naver is actively striving to captivate the global Generation Z (those born from the mid-1990s to the early 2000s), its future customers.

On the 20th, Naver announced it would acquire 100% of Wattpad's shares for $600 million (approximately 660 billion KRW). Wattpad is the world's largest web novel platform, with over 90 million monthly users spending 23 billion minutes.

Having already secured 72 million monthly users worldwide through Naver Webtoon, Naver became the largest global storytelling platform company with 160 million monthly users by acquiring Wattpad, which has 90 million monthly users.

The majority of webtoon and web novel users belong to Generation Z. About 70% of Naver Webtoon's U.S. users and 80% of Wattpad's users are Gen Z. An industry insider said, "Online video service (OTT) providers like Netflix and Disney are fiercely competing to secure original content," adding, "Content from Naver Webtoon and Wattpad, which have been validated by the global Gen Z, is highly likely to attract attention from global OTT companies."

Naver is also accelerating its global strategy by partnering with major domestic entertainment companies in the 'K-pop sector,' content that excites Gen Z worldwide. After strengthening collaboration through investments in YG Entertainment and SM Entertainment, Naver recently joined hands with Big Hit as well.

Naver acquired a 49% stake in Big Hit's subsidiary BeNX for 411.8 billion KRW. Together with Big Hit, Naver plans to build a new global fan community platform by integrating its V Live and Weverse services.

With its IT capabilities and Big Hit artists like BTS having a strong global teenage fan base, this platform integration significantly increases the likelihood of Naver becoming a 'key player' in the global entertainment market.

Zepeto

Especially since the global user base and the proportion of users under 24 years old on Naver's fan platform 'V Live' are 85% and 84%, respectively, there is high interest from global Gen Z, making it likely to develop into a global community where teenage K-pop fans worldwide gather.

Han Seong-sook, CEO of Naver, said during the earnings conference call on the 28th, "If Wattpad's web novels, recognized by global Gen Z, are adapted into Naver Webtoon, it will help expand the global readership," adding, "We will explore various new business opportunities based on high-quality intellectual property (IP)."

Additionally, Naver is targeting Gen Z with its augmented reality (AR) avatar service 'Zepeto.' YG Entertainment and JYP Entertainment each invested 5 billion KRW, and Big Hit Entertainment invested 7 billion KRW in Naver Z, which operates Zepeto.

Zepeto has 200 million registered users, 90% of whom are overseas users. Teenagers make up 80% of its user base. Zepeto allows users to freely create and share content in a virtual space, and the high engagement of teenage users in content creation online is a strong advantage.

User-generated content (UGC) created within Zepeto exceeds 1 billion items, and content sales, including IP-based virtual items partnered with Zepeto, also reach 1 billion units.

An industry insider said, "Platforms that have recently dominated the global market, such as Instagram and Snapchat, initially grew mainly through teenage users," adding, "Following Naver's recent acquisitions and investments, Naver has secured one of the largest teenage user bases globally, indicating high long-term growth potential."

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