Domestic game companies that had been using artificial intelligence (AI) in game development are now emerging as “players” in the AI market itself. Following NC, which unveiled its own large language model (LLM) and spun off its AI business to launch paid services, Krafton has also released a proprietary LLM and entered the general-purpose AI market.

According to the game industry, the preview of “Laon-1 Mini,” released by Krafton on the 21st, was downloaded about 22,000 times (including the lightweight version) on AI model-sharing platform Hugging Face within a week. It is a 3-billion-parameter LLM independently developed from the design stage without additional training on existing models, and it has reduced operating costs by adopting a mixture-of-experts (MoE) approach that activates only 400 million of those parameters.

Krafton has made the model available free of charge so that external companies and developers can integrate it into their own services. This follows the release in April of four AI models related to voice and images, and expands its scope to a general-purpose LLM that can be used beyond games. The company is targeting an official version release within the year.

NC was the first in the game industry to move into proprietary LLM development. In August 2023, it became the first Korean game company to unveil an LLM, “VARCO,” and made it available to external companies through Amazon Web Services (AWS). After spinning off its AI business into NC AI in February last year, the company linked its own AI technologies to paid services. In December of the same year, it launched “VARCO 3D,” which creates three-dimensional (3D) models from text or images, and in September this year it officially released “VARCO Sound,” which generates sound effects and background music. Both services operate on a paid subscription basis.

According to NC AI, the number of new subscribers to “VARCO 3D” in the past week increased by about 300% compared with the weekly average of the previous three weeks. Usage videos released by influencers at home and abroad and promotional campaigns have had an impact. The company is not stopping at independent AI development, but is securing users through paid services and achieving commercialization results. In the first half of next year, it plans to launch “VARCO 3D 3.0,” which improves the model architecture and 3D generation quality. It is also participating in KT’s “AI for All” consortium, developing features that convert images into 3D models and connect them to actual 3D printing.

Nexon and Netmarble, by contrast, are still focusing on using AI to improve production efficiency and user experience. Nexon in June this year unveiled “Danpung,” an LLM specialized for its game creation platform “MapleStory Worlds,” and in September it piloted “AI Connector” in “Mabinogi Mobile,” which allows external AI to act on behalf of players in the game. Netmarble this year appointed Dr. Kim Jae-il, an expert in LLMs and AI agents, as head of AI strategy. The company is developing AI agents that directly play games to detect bugs, as well as character voice generation technologies.

Kim Jung-tae, a professor in the Department of Game Studies at Dongyang University, described game companies’ proprietary AI development as “an investment for survival in the AI era,” adding that “rather than engaging in full-scale battles with global big tech, it is necessary to start by developing language models specialized in content and games.”

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