Drawing on tremendous success in its home country of Korea, Internet and gaming powerhouse NHN announced this week it plans to launch an online game destination in the American market this fall.

The news comes as video game investors and other market observers tout the primacy of the Internet in the future of video games. Having established itself in Asia, NHN believes entering the United States is the next step in the company’s continued growth.

“Our plan is to become a major player worldwide, so getting a foothold in the U.S. is a critical step for NHN,” CEO Beom-Su Kim said in a statement. Company representatives said executives would not offer additional comments at this time, but promised to reveal more details closer to the portal’s launch.

Formed in 1999, NHN currently boasts a market cap of more than $5 billion, the largest on the Korean stock exchange. For 2006, the company expects revenues of KRW 510 billion ($536 million) and income of KRW 190 billlion ($199 million).

The company stands tall in its home market with its Naver Internet search portal and Hangame game portal. Naver is the No. 1 search site in Korea, besting Silicon Valley darlings Google and Yahoo. Estimates of Naver’s dominance in Korea vary but place it atop all rivals. According to WebSideStory, Naver’s links account for some 58 percent of search referrals, while KoreanClick puts that amount just shy of 80 percent.

According to NHN, Naver handles some 1.5 million visitors and 700 million page views each day. Since the Hangame launch in 1999, NHN said the site has attracted some 24 million subscribers and 230,000 concurrent users. Hangame offers 130 different games.

U.S. Base Camp

To emphasize how seriously they intend to focus on the U.S. market, both of NHN’s founders have relocated to the U.S. The company’s American subsidiary opened its doors last July in Mountain View, California, and employs about 50 people. NHN said it expects that number to hit 80 by the end of the year.

As NHN plans its move, many believe the future of the game industry includes the Internet. The subject was an area of focus during last month’s video game investor conference in San Francisco. “The next billion-dollar opportunity is the Internet,” said Gilman Louie, former head of the CIA’s venture fund and one half of the newly formed Alsop Louie Partners (see Game Investors Tout the Net).

At the same time big companies like NHN are interested in reaching U.S. gamers, so are tiny startups. The virtual cats and dogs offered by Seoul’s GoPets—which combines the appeal of Nintendogs and MySpace—have attracted more than 350,000 users since the company’s 2003 founding. GoPets recently visited Silicon Valley as part of a stateside fund-raising trip (see Q&A: GoPets’ Erik Bethke).

The moves come as U.S. companies continue to scramble to build more complex massively multiplayer games. Blizzard Entertainment broke the mold with its genre-defining World of Warcraft, which has amassed more than 6 million players worldwide and remains the title to beat.

Other successful massively multiplayer games include Lineage and Guild Wars, published by South Korea’s NCSoft. NHN’s ArchLord is coming to the West via the U.K.’s Codemasters.

Contact the writer: ROlson@RedHerring.com