Why Naver’s Wattpad and Webtoon Partnership is ‘A Whole New Wild Ride’
Wattpad executives are hailing potential collaborations with Webtoon under the umbrella of South Korea’s internet conglomerate Naver as “a whole new wild ride” for both companies.
Naver acquired text-based storytelling platform Wattpad in a cash and stock transaction valued at more than $600 million, with the deal closing earlier this month. Wattpad and Webtoon, digital home to thousands of cartoon stories, reach a combined global audience of 160 million people, according to a company statement.
“You take two companies that are driven by audience by fans and by … creators all over the world, we are quite literally, doubling the power that we have as two groups,” Wattpad Studios head Aron Levitz said, calling the two companies a “perfect collaboration” under Naver. “We’re really just going to be able to continue to both play to our strengths.” He added, “We both started from one very simple point, which is, we take care of creators who are creating billion universes.”
Wattpad’s social storytelling platform welcomes fiction content, which the company hopes may be developed into digital comic book content.
Wattpad will remain headquartered in Canada under the leadership of founders Allen Lau and Ivan Yuen. Lau, who is CEO of Wattpad, will report to Webtoon CEO Jun Koo Kim. Wattpad’s core app will continue to operate independently while collaborating with Webtoon and other Naver brands. Under its new banner, Wattpad plans to grow its teams by almost 50%, adding nearly 100 people in 2021.
Lau called Webtoon “the No. 1 reason” Wattpad entered into the Naver acquisition. “Webtoon has 70 million monthly users. It is one of the largest, if not the largest digital comic publisher in the world,” he told TheWrap. He added that Wattpad and Webtoon have similar business models “except they focus on comics, and we focus on fiction. Some of our top content, it’s not hard to imagine, we can adapt to the Webtoon platform. Our entertainment ecosystem has expanded quite drastically overnight.”
Wattpad’s Aron Levitz, Allen Lau
Wattpad was already riding high before the acquisition. The company, founded in 2006, surpassed 80 million monthly users in August of 2019, growing its base 23% from the previous year. Wattpad allows users to write, post and read short, text-based novels. Readers can engage with the content by commenting on the novel or “liking” specific paragraphs. This data is then used by the company to identify emerging trends within the platform — including the type of content written and degree of engagement. Sony Pictures Television, Hulu, iflix in Indonesia and the CBC in Canada are among companies that have used this data to create video programming.
In 2016, Wattpad launched its own production company, Wattpad Studios, and in 2019 launched a publishing imprint, Wattpad Books.
Wattpad has 90 film and television projects in development around the world, including the romance “Slow Dancing,” as well as “She’s With Me” and “The Last She” with Sony Pictures Television and “Float” with Collective Pictures, to star and be produced by Robbie Amell.
Other projects that developed from Wattpad content include the film version of the best-selling novel “After,” which received one billion reads on Wattpad, and the film’s 2020 hit sequel “After We Collided.” There are six “After” films planned for the franchise. Hulu’s “Light As a Feather” was produced by Wattpad, AwesomenessTV and Gramnet. Wattpad also reports that its original video series “Turn On,” launched in 2021, reached* *10 million views in its first season.
Levitz said the pandemic has fueled the growth of Wattpad, creating a 150% jump in the number of writers who are contributors on the app. Although most of Wattpad content is available for free and the writers are not paid, some qualifying writers may monetize their stories via the Paid Stories option, in which readers pay for the content with Wattpad “Coins,” available through the Wattpad app. In some cases a popular book may be picked up by Wattpad Studios and the writer is paid for the deal.
Levitz noted that, unlike in traditional publishing, the creator can post a first chapter and get feedback from readers before completing the book and having it published — or rejected. He added that there are no gatekeepers, such as agents and publishing houses, to keep writers from launching their vision. Levitz added that the pandemic fueled a 60% rise in stories involving mental health issues.
Lau said he believes Wattpad’s attractiveness to content-hungry producers is due to a business model that relies on data-driven decision-making. “We are transforming the whole industry,” he said. “We make a decision on a piece of content not because Aron likes it, not because I like it, but because it’s backed by a million fans.”