No Royalties
Daum Kakao is engaged in a large-scale character business using Kakao Friends, but its original creator is reportedly not receiving any royalties from KakaoTalk characters.
The absurd situation is due to the fact that the creator handed over all copyrights to Daum Kakao when the two parties signed a contract. With the character-based industry receiving a lot of attention, the fact that Daum Kakao does not recognize a copyright holder's rights is pretty shocking to the industry, since the company is viewed as a leader in the character business.
According to industry sources on June 11, it was confirmed that Kwon Soon-ho, who designed the major characters of Kakao Friends, does not receive any royalties from Daum Kakao's offline character business using Kakao Friends.
Kakao Friends' representative characters like Muzi, Jay-G, Frodo, Neo, and Apeach were all created by the person. These characters are provided free of charge in the form of stickers on KakaoTalk, Korea's top mobile messenger application.
Daum Kakao recently set up an independent corporate body called Kakao Friends mainly with these characters, kicking off a large-scale offline character business.
The industry expects that the offline character business like Kakao Friends will grow from the current hundreds of billions of won to 1 trillion won (US$895 million) in 2 to 3 years. Kakao Friends intends to dominate the market using major KakaoTalk characters, which are hugely popular among Koreans.
Experts are pointing out that people who create characters are helpless in the country, as shown by the Cloud Bread copyright incident last year. In particular, it is stressed that the current structure in which powerless copyright holders cannot get profits after the transfer of their copyrights should be changed.