Exclusive: Naver Webtoon parent becomes shareholder in Chinese short-drama giant DramaBox

GoodShort parent absorbed into DramaBox entity, making Webtoon Entertainment a shareholder

Existing stake converted to Series A1 preferred shares; additional subscription follows

DramaBox tops global short-drama app revenue; webtoon IP collaboration eyed

Webtoon Entertainment's Times Square event in New York in 2024. [Naver Webtoon]

Webtoon Entertainment, the parent company of Naver Webtoon, has become a shareholder in DramaBox, one of China's leading short-drama platforms, according to industry sources.

The company secured the stake after the parent of GoodShort — a short-drama platform in which Webtoon Entertainment had previously invested — was absorbed into a DramaBox-affiliated entity. Webtoon Entertainment then subscribed to additional preferred shares, deepening its investment in the global short-drama platform.

According to IT industry sources, Tap Future Information Corporation, a company in which Webtoon Entertainment held a stake and the parent of GoodShort, was absorbed into Drama Times Inc., the holding entity above DramaBox, on Oct. 8.

In the course of the merger, Webtoon Entertainment exchanged its existing Tap Future shares for Series A1 preferred shares in Drama Times. As of the end of last year, Webtoon Entertainment held a 5 percent stake in Tap Future. Before the merger was completed, it also received a cash distribution of about 7.8 billion won ($5.8 million) from Tap Future.

Webtoon Entertainment then separately subscribed to additional preferred shares of the same class, extending its investment beyond what it had gained through the merger.

As a result, Webtoon Entertainment joined the DramaBox shareholder roster alongside China's Dianzhong Technology, Singapore's Singtel Innov8 and Walt Disney of the United States. The exact stake size has not been disclosed.

Naver Webtoon's booth at the Amazing Festival in France in 2024. [Naver Webtoon]

Dianzhong Technology is a Chinese content company credited with developing and building DramaBox. Singtel Innov8, the venture capital arm of Singaporean telecommunications company Singtel, counts DramaBox among its investment portfolio. Walt Disney also selected DramaBox for its accelerator program last year, providing funding.

DramaBox is a Chinese-owned platform that ranks among the top short-drama apps by revenue worldwide. It specializes in vertically formatted short dramas optimized for smartphone screens, distributing content centered on romance and fantasy genres. Its business model offers some episodes free of charge while prompting paid purchases for later installments.

According to global mobile market research firm Sensor Tower, DramaBox ranked first in worldwide short-drama app revenue in the first quarter. Its global in-app purchase revenue came to approximately 186.8 billion won ($140 million).

The platform has also posted strong revenue in South Korea, ranking second in cumulative in-app purchase sales among short-drama apps in the country from January through October, behind only Netshort.

Industry observers note that the investment came as Naver Webtoon has been expanding its own short-drama business. In August, the company produced and released live-action short dramas based on six of its popular webtoons for overseas markets including North America. Each title consisted of 40 to 50 episodes running one to two minutes each.

Analysts say the move reflects a broader strategy to extend webtoon intellectual property into video content while simultaneously investing in short-drama platforms. "Now that Naver Webtoon has formed an equity relationship with DramaBox, there is a possibility the two could cooperate on content production and distribution down the line," an industry official said.

A Naver Webtoon official declined to comment on the size of the investment in DramaBox, saying there was "nothing we can confirm."

chami@heraldcorp.com