Krafton's Strategic Investments in India's Gaming Industry: A Triumph Over Challenges

In September 2020, the gaming industry witnessed a seismic shift in India as Krafton, the developer of the wildly popular PUBG Mobile game, faced a ban along with 117 other Chinese-origin apps. The Indian government's concern about user data sharing with the Chinese division, Tencent, marked the game as a potential national security threat under Section 69A of the Information Technology Act, 2000. However, the journey from adversity to resurgence has been remarkable, as Krafton navigated these turbulent waters with strategic investments and innovations.

The ban shook the foundation of Krafton's presence in India, which had been a colossal market for the company. With over 175 million installations of PUBG Mobile in India alone, comprising nearly a quarter of the global installations, the loss was profound. Determined to make a comeback, Krafton orchestrated a series of initiatives that demonstrated its commitment to the Indian market.

Firstly, the company shifted its base from China to South Korea under the brand name Krafton. This move emphasized the company's independence from its Chinese affiliations, thus addressing one of the key concerns raised by Indian authorities. Moreover, Krafton rebranded the game as Battlegrounds Mobile India (BGMI), accompanied by India-specific content to resonate with the local audience.

Understanding the importance of data security, Krafton undertook another substantial step: relocating its game servers to Microsoft Azure. This decision not only improved data security but also aligned with India's ongoing efforts to bolster data localization and protection. By demonstrating a tangible commitment to safeguarding user data, Krafton aimed to restore trust within the Indian gaming community.

With these efforts in place, Krafton secured a three-month trial period to relaunch BGMI in India. During this period, the company not only focused on providing an immersive gaming experience but also actively engaged with the Indian gaming ecosystem. The trial phase served as a litmus test for Krafton's strategic approach, allowing it to prove its commitment to India while fine-tuning its offerings.

As the trial period approached its expiration, Krafton made a bold move by investing a staggering Rs 12.42 billion in the Indian market. This significant investment wasn't merely a financial maneuver; it was a strategic play to solidify Krafton's presence and influence in the Indian gaming landscape. By showcasing its dedication to the market's growth, Krafton aimed to sway authorities to extend BGMI's presence beyond the trial period.

Krafton's investments extended beyond game development studios. Beginning with its initial investment in March 2021, the company diversified into various sectors including audio platforms, content platforms, multimedia platforms, and esports. This diversification showcased Krafton's adaptability and its intent to contribute to India's expanding digital ecosystem.

Krafton's journey from being banned to becoming a significant player in the Indian gaming industry epitomizes the power of strategic investments and innovative solutions. As BGMI continues to surge in popularity with over 100 million downloads on the Google Play Store and a top ranking in the App Store's strategy category, Krafton's efforts are clearly paying off.

Krafton's roller-coaster ride in India serves as a testament to the gaming industry's resilience and the transformative potential of strategic investments. As the trial period's end draws near, the colossal investment by Krafton underscores its dedication to India's gaming community. This investment isn't just about finances; it's a commitment to fostering innovation, growth, and collaboration in the vibrant Indian gaming landscape. With BGMI's success story paving the way, Krafton's journey is a blueprint for turning challenges into triumphs through a blend of innovation, localization, and strategic investments in India.