The big news out of Asia today is in Japan with Webtoon Entertainment and Naver Webtoon investing 140 billion KRW (approx. 100 Million USD) into their Japanese subsidiary and the LINE Manga platform (NewDaily).
The funds will be going to the LINE Digital Frontier Corporation, which operates the LINE Manga platform in Japan, a wholly owned subsidiary of Naver Webtoon and Webtoon Entertainment.
Before we get too far, we need some context.
Why Japan?
Everyone knows that the digital scrolling webtoon format was developed and popularized in Korea. Naver wasn’t the first company to use the medium, but they have been the driving force behind popularizing it internationally for mainstream audiences.
It’s important to keep in mind, though, that Japan is Webtoon Entertainment’s largest market internationally. The Q2 revenue for Japan was 150.403 million USD which nearly 12 million USD over Korea which came in at 138.49 million USD.
But, Japan’s revenue for Q2 was 15.4% down from 2025 when it hit 177.881 million USD.
Webtoon Entertainment’s biggest market is Japan and in-country revenue, monthly active user count, and monthly paid user count both fell in Q2 compared to 2025.
See that? That’s context.
I’m not the only one that’s seeing stagnation in the Japanese market as a cause for concern. During the Q2 earnings call early in August, Mark Mahaney from Evercore asked specifically to expand on what WEBTOON was doing about Japan and what was necessary to “return to growth”.
David Lee’s (CFO for Webtoon Entertainment) response focused on local content, greater engagement, and distribution partnerships. Now Naver’s been working with Japanese studios for a while, but they took a monumental step forward in April with STUDIO WHITE, a joint venture between themselves, Kadokawa, and REDICE.
Those last two names cover Sword Art Online, Delicious in Dungeon, Oshi No Ko, Solo Leveling, and Omniscient Reader along with a whole lot of others.
Where’s it going?
In Q2, the global marketing budget for Webtoon Entertainment was 38.336 million USD. Naver and WEBTOON’s investment would be nearly triple that.
It’s enough to reach every online Japanese citizen several times over through online ads, buy physical ad space or run in-person campaigns, host multiple boths at conventions or potentially run their own convention if they pleased.
That being said, I think there’s a bigger push on the horizon.
Content.
That’s where I’m hoping the bulk of the money is going, whether it be straight into production deals or into incentives for studios and creatives when it comes to the Japanese webtoon industry.
Unlike the US or western countries, Japan already had a thriving manga industry developing stories for local audiences. And while webtoon was big with indie storytellers in the US, it’s a whole different market in Japan.
The partnership with Kadokawa in the form of STUDIO WHITE has already resulted in one marriage of webtoon with manga in the form of "“Record of the Lodoss War: Queen of Death”. With the Disney Deal, WEBTOON has original Disney and Marvel content heading for their platform, but it’s a stretch. Western comics have attempted several cross-collaborations with Japanese manga over the decades and it’s an imperfect fit. Manga and webtoons, on the other hand… it could work.
Oof, that view count, though.