NetEase Inc, one of China’s leading gaming publishers, announced on Wednesday that it has rejected a proposal from Activision Blizzard Inc to extend their longstanding partnership for an additional six months. The move comes as the American game developer looks to secure a new partnership in the region.
The partnership between the two companies, which had been in place for 14 years, was widely considered to be one of the most successful and lucrative in the video game industry. However, in November, Blizzard announced that it would be ending its partnership with NetEase, sending shockwaves throughout the industry.
The decision to end the partnership was reportedly due to the inability of the two companies to agree on key terms of cooperation. As a result of the dissolution of the partnership, popular titles such as World of Warcraft will no longer be available in China starting January 23rd.
Last week, Blizzard reached out to NetEase with an offer to extend the partnership for a further six months, but made it clear that they would continue to negotiate with other potential partners. In response, NetEase issued a statement in which they stated that they found the proposal to be “rude and unreasonable, inappropriate and commercially illogical” and accused Blizzard of attempting to “take a free ride.”
NetEase, which has risen to become a gaming giant partly by publishing Blizzard’s games in China, has since accelerated its own game development capabilities, with in-house games now accounting for more than 60% of the company’s revenue.
With the demise of their partnership, Blizzard is currently without a Chinese publisher. It is worth noting that, unlike in other countries, foreign gaming companies typically require a Chinese publisher in order to release games in China.
“It is a pity that NetEase is not willing to extend services of our game for another six months on the basis of existing terms as we look for a new partner,” said a statement from Blizzard China.
In conclusion, the dissolution of this partnership marks a significant shift in the dynamic of the Chinese gaming market, and it will be interesting to see how both companies adapt and evolve in the wake of this development.
