NCSOFT headquarters in Pangyo, Gyeonggi Province / Courtesy of NCSOFT

Korean video game firm NCSOFT will soon create four independent spinoff companies to encourage greater creativity among developers by enabling them to work within more autonomous entities.

According to the game developer, the spinoff plan was approved during a board meeting on Monday. As part of this plan, the company will establish three new game studios and one firm focused on developing artificial intelligence (AI) services.

These firms are nonlisted companies, and NCSOFT will hold a special shareholder meeting on Nov. 28 to finalize the plan. If approved, the companies will be spun off on Feb. 1.

NCSOFT said in a statement that the plan aims to maximize the creativity and innovation of the new companies by establishing autonomous game development studios and enhancing AI research and development capabilities.

Each game studio is tentatively named Studio X, Y and Z, with each of them soon to be endowed with NCSOFT's game intellectual properties (IPs). Studio X will be in charge of the company's massively multiplayer online role-playing game (MMORPG) title Throne and Liberty, Studio Y will lead shooter title project LLL and Studio Z will spearhead the development of strategy game project TACTAN.

After making its global debut on Oct. 1, Throne and Liberty has been showing stable popularity, demonstrating its competitiveness in the global market. NCSOFT said the game is expected to grow into a global IP when it is managed by the independent studio capable of swift and specialized decision making.

LLL is an upcoming open-world MMO third-person shooter game currently under development. NCSOFT revealed the blockbuster game's teaser at last year's G-Star game exhibition in Busan, and gained keen interest for its play style and storyline.

TACTAN has been developed under the project title G, and was titled in May as TACTAN: Knights of the Gods.

The proposed AI firm will be a spinoff of NCSOFT's AI research team. Tentatively named NC AI, the new company will pursue advancing its AI technologies, including NCSOFT's self-developed large language model Varco.

NCSOFT said it will also launch an organization restructuring to streamline its business portfolio and use its resources more efficiently. As part of the restructuring program, a number of development projects will be shut down and several support functions will be ended. Additionally, the company will implement workforce reallocation and offer a voluntary retirement program.

In recent months, NCSOFT has been making efforts to restructure its businesses to address its weakening profitability.

In June, NCSOFT established two spinoff companies — NC QA, responsible for quality assurance services; and NC IDS, handling application software development and supply. In January, NCSOFT shut down its subsidiary NTREEV, and has been laying off its staffers since April.

In the second quarter of this year, NCSOFT reported sales of 368.9 billion won and an operating profit of 8.8 billion won, representing year-on-year declines of 16.1 percent and 75 percent, respectively.