Krafton India CEO sees bright future for gaming in the region, backs AI innovation

In an exclusive interview with Tech Today, Krafton India CEO Sean Hyunil Sohn shared his insights on the company's commitment to esports, emerging technologies like AI, and the thriving Indian gaming market.

Grassroots Esports and a Thriving Scene

The conversation started with Krafton India's flagship esports initiative, Battlegrounds Mobile India Series (BGIS). Sohn expressed pride in the platform's role in nurturing upcoming talent, stating that BGIS is "the esports event for...grassroot players to...step up the ladder into the national scene, or even the top scene." He emphasised that the series has provided a much-needed push for players "to improve and compete."

Sohn also highlighted the success of BGIS in attracting a large audience, noting the "good turnout in terms of audience." The event, he said, is "receiving good reception with a good audience turnout."

Embracing AI for Innovation and Efficiency

Recognising the importance of AI and VR in the evolving gaming landscape, Tech Today's Pranav Dixit asked Sohn about Krafton's approach to integrating these technologies. Sohn revealed that Krafton had previously experimented with a VR version of PUBG PC. Although the project was ultimately scrapped, Sohn emphasised that the company remains committed to exploring new technologies.

"We used to have small pilot projects, like porting PUBG PC into a VR version. We tried that, but it didn't give us a very smooth experience, so we scrapped it. That was a long time ago, like four or five years back."

Turning to AI, Sohn identified two key aspects of its application: using generative AI to streamline game development and incorporating AI as a core gameplay element.

He explained that "conceptualisation of new gaming ideas has become cheaper and much smoother because of generative AI technology. You don't really need conceptual artists anymore. You can just use DALL-E or diffusion or something like that to conceptualise and visualise your gaming ideas."

Sohn acknowledged that these applications are not unique to Krafton, but he emphasised the company's focus on developing "AI bots within the game to provide a good gaming experience." He believes that these AI bots have the potential to significantly enhance gameplay.

"Magic Mike" and Other Experimental Projects

Delving deeper into Krafton's exploration of AI-driven gameplay, Sohn revealed an experimental project called "Magic Mike," describing it as "a very experimental and small game." He elaborated, "What we are trying to do is invent new gameplay that can be enabled by AI technology. We believe that if that potential is unlocked, it will create a lot of opportunities for new gameplay, which was not possible before this AI knowledge."

"Magic Mike" utilises voice recognition technology. Players shout specific "magic spells" into their microphones, which are then recognised by the AI module within the game, triggering specific actions or events.

Sohn described another experimental project, a mystery story game where players interact with an AI bot to gather information and solve the mystery. He acknowledged the potential of such games to become mainstream, citing the success of their previous battle royale game.

Krafton's Investment Strategy: Acquisition and Partnerships

Sohn also shared insights into Krafton's investment plans. While revealing an upcoming announcement of one or two startup investments, he clarified that these investments are relatively small. "We are looking at a larger acquisition opportunity...perhaps in a more mature stage, like a growth stage company, maybe with revenue between 50 million and 100 million...but there's nothing very imminent...no deal close to being closed."

Navigating India's Regulatory Landscape

On the topic of regulatory environment in India, particularly regarding the gaming industry. Sohn asserted that "India is not a bad place to be as a gaming company," despite the challenges posed by regulations and unpredictable events.

He expressed optimism about the government's evolving stance on gaming and esports. "I think the government now understands gaming and esports much better, and they are trying to incentivise the industry's development. I believe there will be more positive government policies and intervention."

Sohn cited the increasing discussions about establishing Centers of Excellence for gaming in Mumbai, demonstrating the government's commitment to fostering the industry's growth.

Monetisation and Global Expansion

Addressing the prevalent free-to-play model in gaming, Tech Today inquired about Krafton's revenue streams. Sohn acknowledged that in-app purchases are central to their revenue strategy, while ads are less lucrative unless a game enjoys substantial traffic. "We will be more focused on in-app purchases for our revenue stream."

He stressed the importance of setting appropriate price points and value packages for Indian gamers, citing the success of BGMI as an example of their successful monetisation strategy.

Regarding global expansion, Sohn emphasised the importance of establishing a strong presence in both Western and Eastern markets. "There is a widely accepted belief that if you want to create truly sizable and new IPs, they need to be popular in the Western market." He acknowledged the dominance of the Chinese market but highlighted the need for balanced global appeal for long-term sustainability.

Sohn reaffirmed Krafton's commitment to investing in the Western market, both through dedicated teams and through creating original IPs tailored for that audience. He pointed to the early popularity of BGMI in the West as a testament to this strategy.

A Bright Future for Gaming in India

Concluding the interview, Sohn expressed immense optimism about the future of gaming in India. "India is currently number...maybe between number three and five in terms of revenue size. It's pretty rare for any global gaming company to see that, because the Indian gaming market, in terms of revenue size, is only somewhere between number 10 and 15."

While acknowledging that the Indian market is still relatively small "given the population," he emphasised its rapid growth rate of 15-20% annually. Sohn anticipates that India will break into the top 10 gaming markets within the next 3-5 years.

"I am very positive about the future prospects of the Indian market as an important gaming market," Sohn concluded.