LD Studio (10)
The conference hall descended into chaos in an instant, and the whole thing was broadcast live across every major streaming site.
Even the users who had still been hanging on turned their backs the moment they were told they’d be paid in crowns and RT coupons instead of cash refunds.
Every word Park Hyunjong spoke at the meeting became a controversy in its own right.
Both the Korean Game Industry Association and Park Hyunjong himself had essentially admitted that other game companies were also running variable odds. Or rather, they had “admitted” it.
As the backlash grew, the Korean Game Industry Association announced that it would “revise the statement because of some typos or misunderstandings,” but there had been no typos, and there was even less room for misunderstanding.
Other game users, too, began digging into the issue with growing suspicion. And once they started looking, new scandals came tumbling out one after another, like potatoes being pulled from the ground.
Hedge funds that had made a killing shorting LD Studio all shifted over at once and started hammering the stock there as well.
Rexon, Letmarble, and the other major game companies were thrown into panic.
They had been watching someone else’s house burn, and suddenly the flames leapt onto their own.
“What the hell? Why is this hitting us too?”
“Jesus, if you’re going to die, die alone! Why drag us into it?”
“What we did is a drop in the bucket compared to Brotherhood M.”
“No, seriously, how big a sin is probability manipulation supposed to be…?”
They had their own arguments, of course.
The reason people were drawn to randomized loot boxes was simple: if they were lucky, they could pull a great item for cheap.
But what if the listed odds were 0.00001 percent? Lower than the odds of winning the lottery?
The moment people saw those numbers, most of them would give up without even trying.
That was why game companies had to create the impression that the items were at least somewhat obtainable.
If the odds were listed at around 1 percent, players might think it was worth a shot. But what happened if enough people flocked in and one in a hundred actually pulled the item?
Then the game’s balance would be ruined.
So they listed the rates at numbers that seemed worth chasing, while quietly manipulating the actual odds behind the scenes.
Either way, they couldn’t admit to probability manipulation just because LD Studio had been exposed.
And so the excuses came pouring out.
“The odds listed in the probability chart were written arbitrarily. Even the company can’t calculate the exact probability.”
“What we’ve been doing all along is only disclosing the odds by item acquisition tier.”
“When we wrote 1 percent, we meant anything below that.”
“If you look at the very bottom of the probability chart, there’s fine print that says, ‘May be applied randomly.’”
“Variable odds are a global trend.”
Gamers, for their part, were stunned.
What had started as a probability-manipulation scandal at LD Studio had now snowballed into a chain reaction shaking the entire Korean game industry.
* * *
As the situation spread out in every direction, even the political world got involved.
National Assembly member Namgung Seok of the Our People Party pulled out the “Randomized Item Regulation Act” he had once already proposed.
It included mandatory disclosure of odds for all randomized items, whether paid or free; a pity system; required verification methods for probability checks; and triple compensation in cases where manipulation was caught.
Naturally, the game companies fought back with everything they had.
“This could shrink the entire game industry.”
“Korean users have poor spending behavior, so randomized items are unavoidable.”
“Game companies still need to recover server and marketing costs, don’t they?”
“This could amount to reverse discrimination against Korean games.”
“What country forces private companies to reveal their trade secrets?”
“Users themselves oppose it, since it could hurt existing players!”
One company even went so far as to say, “Randomized systems are the best way to distribute items as fairly as possible to every user.”
But Namgung Seok’s answer was firm.
“You’ve had more than enough chances, and the industry has only proven that it cannot regulate itself. You’re fighting so hard to dodge disclosure that it’s obvious you have something to hide. I will make sure this bill passes.”
In the past, gamers might have sided with the companies.
But after this mess, all goodwill had evaporated. They threw themselves behind the bill with even greater force.
* * *
LD Studio, which had once boasted a market cap of 35 trillion won and a top-ten ranking on the KOSPI, kept plunging day after day until its value had shrunk to that of a mid-sized game company.
The other major game companies were also collapsing, but LD Studio was the only one to lose 80 percent of its stock price.
Users kept protesting in front of the company headquarters, demanding cash refunds.
Someone had to take responsibility for this disaster.
But it wasn’t something the CEO could simply shoulder alone.
As a result, the arrow naturally pointed toward Park Hyunjong, the so-called father of the Brotherhood series.
In a room with only the two of them present, Jin Taekyung spoke to him.
“Looks like you should step back for a while.”
Park Hyunjong looked flustered.
“What are you talking about?”
“You can see the mood, can’t you? They’re about to drag me before the National Assembly. We need to at least show that someone’s taking responsibility and stepping down.”
The two of them had been seniors and juniors from the same school.
They had founded LD Studio together, starting in a one-room apartment and grinding through every kind of hardship to build the giant company it had become.
And now, after all that, he was going to cut me out?
Jin Taekyung said to him, “You know as well as I do that there isn’t any other choice right now. Once things calm down, I’ll call you back. Just bear with it until then.”
“...Understood.”
Left alone, Park Hyunjong could hardly believe what had become of his reality.
How the hell did it come to this?
Only two weeks earlier, Brotherhood M had been doing well, and his position had been solid.
But now the user base had been cut to a quarter, and revenue had fallen to less than a tenth of what it had been. LD Studio’s stock price kept crashing, and his own net worth had shrunk by about 3 trillion won.
Everything he had said at the conference hall was being uploaded to streaming sites and news articles, where it was now a punchline.
Complaints and condemnation had poured in from other game companies too, furious that he had dragged them into it as well.
And now he was on the verge of being thrown out of the very company he had founded and devoted his life to.
He knew the logic of business all too well. Once you were forced out, that was the end of it. Even if he came back later, his place would be gone.
As he sat there in a daze, his secretary said, “Continue Capital is on the line. What should I do?”
“...What?”
Park Hyunjong was startled.
Continue Capital had been the beginning of all this. What on earth would they be calling him about now?
Curiosity alone made it impossible not to answer.
When he picked up, he heard the voice of a young man.
“Hello, Executive Director Park Hyunjong. This is Han Miru of Continue Capital.”
“Ha, Han Miru?”
The one who brought down Vice Chairman Ju Cheol-jin at Hanjeong Mulsan’s shareholders’ meeting?
He was the number two at LD Studio.
Given his position, he knew more or less everything that happened in the business world, and he had heard of Han Miru too.
Could it be that bastard set this whole thing up?
“By now, I’m sure you’ve been pressured to resign in order to calm the furious public.”
That got under his skin.
“Why are you calling me?”
“You must have a lot of questions about what’s happened recently. I thought it would at least be polite to tell you why things turned out this way.”
“Why?”
Was there really some other reason besides making a fortune off the short?
“Not long ago, you pressured the company into firing one of your employees unfairly. Do you remember a Kang Seon-woo?”
“K-Kang Seon-woo?”
Of course he remembered.
He was the bastard who had lured his son into investing in a manipulated stock.
So to make sure nothing like that happened again, Park Hyunjong had singled him out, blocked him from moving to another development team, and then notified him of termination under recommendation.
“What does that have to do with the current situation…?”
“Ah. He’s a friend of mine.”
For a moment, he couldn’t quite process what he was hearing.
What the hell does that even mean?
A moment later, Park Hyunjong shouted into the phone.
“Wait a second. You did all this because of that?”
“Yes. When a friend is unfairly fired from the company he’s been working hard for, what am I supposed to do? Just sit there?”
“You expect me to believe that?”
“Believe it or don’t. That’s your choice. Anyway, I’m hanging up now.”
The call ended.
So all of this happened because I fired one employee? And I ended up like this?
Not only had he led his own son down the wrong path by getting him involved with a manipulated stock, but now this, too?
Park Hyunjong burst out laughing from sheer disbelief.
“Ha... ha ha ha!”
* * *
While game companies were collapsing one after another in Korea, we calmly closed out our short positions. After deducting all the associated costs, the profit came to about 65 percent. For a short-term investment, it was a very nice haul.
Herbert Lentz said to me, “Thanks to you, we made a successful investment.”
“Not at all. I’m the one who should be thanking you.”
With Empty Pool Research joining in, we were able to drive the stock down faster and harder.
We shook hands lightly.
As I left Empty Pool Research and headed back toward the office, Seon-woo called me.
“Hey! What the hell did you say to my company?”
“Why?”
“Park Hyunjong suddenly called me and started ranting that it was all my fault or whatever.”
“Oh, that? Don’t worry about it.”
“No, how am I supposed to not worry about it?”
I changed the subject.
“What’s the atmosphere like in the game industry?”
“It’s total mayhem everywhere. Still, it’s not all bad. Games that were actually well made but never got any attention are starting to get noticed. Some companies are even dropping mobile games altogether and shifting toward console and packaged titles without randomized items.”
Until now, every game company had been obsessed with monetization and loot boxes. But this incident had shown them that those kinds of games weren’t going to keep selling forever.
If they wanted to survive, they’d have to make something new.
“You should start a game company too and get moving on development.”
“Huh? Me?”
“You’ve been telling me for years that your dream is to start a game company and make the games you actually want to make. Cloud gaming and VR gaming are all the rage right now, so don’t you think it’s about time you got started too?”
“You’re really telling me to start one?”
“I promised you, didn’t I? If you invested in me, I’d cover whatever the development costs were. Ah, and we acquired Legend Games too.”
Seon-woo was startled.
“What? Seriously? The Legend Games that made the Surreal Engine and runs Legend Store?”
“Yeah.”
“Why are you only telling me this now?”
“I just thought of it.”
After a moment of hesitation, Seon-woo asked quietly,
“Do you think I’d actually be good at it?”
“Don’t worry. You’ll do fine.”
That wasn’t just something I was saying to be nice.
I thought back to my first life.
Even if it hadn’t been exposed now, Brotherhood M had already been showing its limits and seeing revenue decline. LD Studio had been pouring all the money it earned into developing a new game.
At the time, the biggest topic in the game industry was VR.
It was still crude then, but within a few years it would be possible to build a truly immersive gaming environment.
Seon-woo had been in charge of that VR MMORPG as its director. But the development costs ballooned like a snowball, and once the Brotherhood M scandal hit, Seon-woo was fired and the project was shut down.
Later, though, Wechant would come in and take over LD Studio, continue the development, and end up striking it absurdly big after release.
“You’re a skilled developer.”
---