More companies jump into NFT markets

By Kim Hyun-bin

Major conglomerates are jumping into the non-fungible token (NFT) business, which has been gaining attention as a rising blockchain-based service. Not only are large information technology (IT) and telecommunication companies issuing NFTs and expanding platforms, but manufacturing giants such as Samsung Electronics, LG Electronics, SK and Hyundai Motor are also engaging in NFT-related businesses and investments.

NFTs refers to digital content such as videos, images and music, which are given a unique recognition value with blockchain technology. The sector is forecasted to grow in Korea to $35 billion, from $14 billion last year. As the market is growing rapidly, even traditional conglomerates are entering the NFT business.

Naver established a partnership recently with Line Next, a subsidiary of Line, a messenger platform affiliate. Line Next plans to launch its DOSI NFT platform in the first half of this year, giving companies and creators an easy way to produce and sell NFTs using their intellectual property.

In addition, Naver Corp., Naver Webtoon, and Naver Z are joining the strategy to grow the NFT business. Within this year, Naver Pay plans to support payment methods for purchasing cryptocurrencies and NFTs.

Kakao is operating an NFT platform called Clip Drops, which its affiliate Ground X can use on Kakao Talk. Earlier this year, Kakao Entertainment’s popular webtoon “Level Up Alone” launched 100 limited NFTs from Clip Drops, which sold out in one minute. Within Kakao, NFT and other blockchain technologies are cited as the key to going beyond the mobile business.

“NFTs can be used in various industries in the future. It will ultimately contribute to opening up the field of activities where any company can produce and publish NFTs easily and conveniently with just an idea,” an official from Kakao Enterprise said.

Large corporations are also jumping into the NFT market one after another. It shows that NFTs are actively used as a marketing tool for products.

Home appliance rivals Samsung Electronics and LG Electronics are preparing TV products that can display NFT art. As investments in NFTs increase, the demand for physical exhibition and appreciation of NFT art is also increasing.

LG Electronics (LGE) plans to commercialize blockchain technology, including NFTs. Since last year, LGE has been steadily recruiting blockchain experts and showing interest in NFTs. In collaboration with Ground X, it also introduced a service enabling NFT-applied artworks to be viewed on LGE TVs.

Samsung Electronics plans to install an NFT display platform on all smart TV models to be released this year, including the Neo QLED TV. The NFT platform was first unveiled earlier this year at the Consumer Electronics Show (CES) in Las Vegas and received the Innovation Award.

Samsung Electronics’ investment subsidiary Samsung Next is investing a significant amount of funds in NFT-related startups. In 2018, long before the NFT boom, it started investing in Dapper Labs, which made “Crypto Kitty,” a cat-breeding NFT game. In February this year, it decided to invest in Metaplex, an NFT production and trading platform.

Hyundai Motor Company will enter the non-fungible token (NFT) market for the first time in the automotive industry, the company said.

The company released a video introducing the Hyundai NFT worldview “Metamobility Universe” in accordance with its plan to enter the community-based NFT market and provide consumers with a variety of brand experiences, in collaboration with the popular NFT character MetaKongz.

“Entering the community-based NFT market is another means to communicate with customers and provide a variety of experiences,” a Hyundai Motor official said.

The mobile communication industry is also cultivating NFTs as a new growth engine. SK Telecom, which issued NFTs recently in collaboration with lifestyle brand Peaches, is holding an event to provide NFTs through a lottery to customers who have participated in the presales of the Galaxy S22 series.

KT also decided to issue NFTs through its group company Storywiz and plans to start the KT NFT beta service.

By far, the gaming industry stands out the most. It is investing heavily in new businesses that focus on converting existing gaming money and gaming items into NFTs. Major gaming companies such as WEMADE, Netmarble, Com2uS, Pearl Abyss and NCSOFT are vying to introduce “play-to-earn” (P2E) game plans that can make money using NFTs.

NFTs for marketing

The retail industry seems to be actively using NFTs for marketing as a way to induce active participation of consumers by making the characters of their brands into NFTs. LG H&H decided recently to issue NFTs for the first time in the beauty industry. Its purpose is to create NFT characters of its own brand belief and sell them to consumers and provide various benefits and opportunities for participating customers.

BGF, the operator of the convenience store brand CU, issued NFTs and held a gift event with Rayray. Chicken brand BBQ also issued an NFT using the image of its chicken-shaped character.

SK plans to issue its own cryptocurrency. SK Square announced its plans recently to release a cryptocurrency white paper within the first half of this year together with its affiliates, and expand its services in connection with the issuance of a cryptocurrency within the year. Last year, the company invested about 90 billion won in Korbit and became the second-largest shareholder in the virtual asset exchange.

“Despite the uncertainties of the global macro economy this year, there will be many opportunities to invest in good companies at good prices in the M&A market. We will make the first year of increasing SK Square’s corporate value by investing in these high-quality semiconductors and blockchains,” SK Square Vice Chairman Park Jung-ho said in a recent shareholders’ meeting.