Internet platform giant Naver announced its acquisition of web novel platform Wattpad on Wednesday, more than doubling the size of its social storytelling operations. Naver will acquire 100 percent of Wattpad shares for approximately $600 million in the first half of this year.

Wattpad is an online platform that allows anyone to read and write stories. With over 90 million monthly users who spend a total of 23 billion minutes each month, Wattpad is the largest social storytelling platform in the world. Combined with Naver Webtoon, which has 72 million monthly users, the acquisition would allow Naver to expand its global content business in a more stable and efficient way, the company said in announcing the deal.

“Naver Webtoon is able to take hold of more diverse global storytelling IP (intellectual property) through Wattpad,” said Naver Webtoon CEO Kim Jun-koo in a press release Wednesday. “By synergizing with Wattpad, the multidimensional capacity of Naver Webtoon IPs will be strengthened, making the company one step closer to becoming the best global entertainment company.”

Naver Webtoon created a successful profit model for webtoons through its Page Profit Share Program in 2013 that introduced pay-per-view webtoons and advertisements on webtoons. Naver Webtoon exceeded 3 billion won ($2.7 million) in single-day revenue in August last year. Naver, which has a domestic platform for Korean web novels, is betting that an ecosystem for web novels can be made in a similar fashion by applying its successful webtoon business model to Wattpad, which has lacked a means of monetization.

“Wattpad doesn’t have many ways of generating profit. How Wattpad changes will depend on Naver’s strategy. Whether they use it to further promote existing profitable content on the platform or use it as an extra platform to promote Korean web novels remains to be seen,” comic critic Sung Sang-min told The Korea Herald.

The acquisition opens doors for Korean web novels to be featured on Wattpad and for Wattpad novels to be made into webtoons.

“Like how Korean webtoon artists have been able to start global careers and gain more profit through Naver Webtoon, we will help web novel artists advance to the international stage,” said Kim of Naver Webtoon.

With Korean webtoons reaching the worldwide audience, earnings by webtoon authors have never been better. The average salary of webtoon authors was 310 million won ($282,000) in 2019, according to Naver.

Naver’s international webtoon platform has found success in having local authors create original stories in the webtoon style in addition to translating popular Korean works into different languages. Lately, many popular Korean web novels, including “Omniscient Reader,” “The Remarried Empress,” “Solo Leveling” and “The Legendary Moonlight Sculptor,” have been made into webtoons to immense popularity. With access to the original stories of Wattpad that are especially popular among Generation Z, who account for 80 percent of Wattpad users, web story-based webtoons that cater to readers’ tastes can be created.

Furthermore, Wattpad contains Wattpad Studio, which develops global video content, making possible collaborations between Naver Webtoon’s own video-creating subsidiary Studio N. Studio N has participated in creating drama series such as Netflix’s “Sweet Home” and tvN’s “True Beauty,” which are based on popular Naver webtoons. With many web novels in Wattpad already having been made into TV series, movies and animations and featured on Netflix, Naver can hope to further expand the intellectual property market of web novels.

“Naver has been expanding its entertainment contents since 2018. Naver‘s acquisition of Wattpad shows that it has set eyes on global expansion of web novels in addition to webtoons,” said Sung. “Webtoon content is enjoying success worldwide, but Naver wants to expand further. The move shows Naver’s attempt to become a multidimensional entertainment company.”

By Lim Jang-won (ljw@heraldcorp.com)