Cyworld home page of an user
Are you using Facebook.com or Myspace.com? If you are from outside Korea, your answer should be Yes, if you are not a person enjoying isolation. However, in Korea, the question should change like this: are you using Cyworld? Cyworld.com is a social networking website launched in 1999, and more than 90 percent of the Korean 20s are using the site for their social life. Its weekly page view is more than 4 billions, which is the second highest number.
Why Cyworld was so successful? I mentioned Koreans’ early-adapting nature in my previous blog, and it was obvious in the introduction of digital cameras. Many young Koreans who purchased digital cameras wanted to share their pictures with their friends. Maybe, the same need should exist in other countries, but what was different was that the rate of penetration was much faster in Korea.
Another innovative feature of Cyworld was that it implemented Acorn System. Users buy acorns, cyber money in Cyworld, with real cash, and use them for installing trendy songs as background music and pretty wallpapers in their home page. People can buy acorns at convenience stores as well as on-line. It was the first successful case of monetizing page views, which enabled continuous re-investment.
Cyworld is still one of the most popular sites in Korea. In 2003, it was acquired by SK Communication, an affiliate of SK Group, the third largest conglomerate in Korea. It launched Cyworld service in Japan, USA, Taiwan, China, and Vietnam.
Their biggest challenge should be future growth. Korean internet penetration seems to have reached its saturation point while their overseas business doesn’t look successful so far. Nevertheless, they are still competent in Korea, evidenced by the fact that their international competitor Myspace.com announced withdrawal from Korea in 2009. It shows pros and cons of strongly localized internet service.
