NEXON Makes Strategic Investments in PlayFusion and IMC Games

This is not investment advice. The author has no position in any of the stocks mentioned. has a disclosure and ethics policy.

PlayFusion, the employee-owned company based in the UK and US, have announced a strategic investment by Korean game developer and publisher, NEXON (TYO:3659). This follows an announcement from the start of this week that they had also invested in IMC Games.

NEXON investing in IMC Games makes perfect sense. Tree of Savior is similar to NEXON's titles in that it's a free to play online game that's funded by microtransactions and it would also work well through the NEXON launcher, giving it access to an increased userbase. It also fits in well with the company's core game titles. Tree of Savior already has ties to the company, being published in Korea and Japan by NEXON. In the UK and US, however, it's published by IMC Games themselves.

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With past successes like MapleStory, Mabinogi, Vindictus and Atlantica Online, some of them similar titles, the company is understandably looking for future hits. Tree of Savior would likely benefit from interest gained through links with the company.

This investment has also benefited NEXON in that they will now help develop and then publish Tree of Savior Mobile Remake. I recently covered the size of the digital market and included is the sheer size of the mobile market. Launching Tree of Savior on mobile devices, tying it into an already launched game with an existing userbase. Should the mobile game be successful, it could potentially lead players into playing the PC release.

Nexon and the Curious Investment in PlayFusion

What does seem to be an unusual investment is the one in PlayFusion. While PlayFusion are certainly in the games sector, having successfully used Kickstarter back in november to fund Lightseekers. The reason it's somewhat strange is the nature of Lightseekers itself. Frankly, it doesn't fit NEXON's usual products.

Lightseekers is a cross-media venture that hopes to successfully launch as a free to play game that is interlinked with 'smart' action figures, a trading card game as well as comics and more. To say this is ambitious is an understatement to say the least. However, the company has already partnered with Tomy (TYO:7867) who will act as the licensee of Lightseekers. Other partnerships also include Toys "R" Us who are to sell the figures, cards, comics and more in stores worldwide.

What makes PlayFusion an interesting partner is the technology they are using in the game. The company describes itself as having designed a 'revolutionary omnimedia platform of proprietary next generation interactive entertainment technologies'. What is important to this is also the FusionCore which is an Internet of Things (IoT) mini-computer. This will allow the action figures, which allow accessories like weapons to be equipped, to communicate with the game. This also allows the game to trigger feedback, such as vibrations, in the figures.

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Other parts of this platform include ImageFuse, which is an image recognition and augmented reality technology. This will allow the upcoming trading cards and interactive comic books to animate and interact with the Lightseekers video game. AudioFuse is a noise tolerant audio recognition software which will be used on Lightseekers videos that are slated to appear on YouTube later this year.

Finally there is DataFuse. This is designed to remember the player, their actions and 'power dynamic consumer content' to keep them engaged. What it also allows is to collect insights on consumers, how they play and what areas of Lightseekers is interesting to them. This should allow for a more focused approach for the game, should it garner the interest it needs.

What can NEXON gain?

It is certainly possible that NEXON (TYO:3659) would look to publish the video game segment of Lightseekers. Following the successes of Skylanders, Disney Infinity and Lego Dimensions is certainly something the company will hope to do. The problem comes with the knowledge that those titles had brand recognition to boost them where Lightseekers doesn't. In addition, Lightseekers is attempting to use some impressive technology which could end up costing it dearly.

What could certainly be an interesting aspect for NEXON is if this should prove a success. Providing the company can use the PlayFusion technology to its own benefit, it could boost their own platform through allowing for improvements and insights on consumers. At the same time, should Lightseekers be the success that Skylanders, Disney Infinity or Lego Dimensions was, then that's also a boost for the company.

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