A surprise revelation came in November 2022: that many of Activision Blizzard’s game services could be suspended in mainland China as a result of their decision to part ways with China-based publisher NetEase.
Games such as World of Warcraft, Hearthstone, and Overwatch were, and are, due to be affected. The two have had licence agreements dating back to 2008.
At the time, it was speculated that Activision Blizzard would be seeking a new agreement with another company in China, and this turned out to be true. The World of Warcraft developer reportedly entered the final stage of negotiations with a new Chinese partner earlier this January. As to whom negotiations were with, predictions included Perfect World, Alibaba Group, ByteDance and Tencent.
An olive branch snatched away
However, with the resolution of a new deal still dragging on (and hobbling Activision Blizzard's Chinese earnings) it now appears that they essentially came back begging – asking NetEase for a renewed licence so that its games can continue in the lucrative Chinese market. As reported by Reuters, Activision Blizzard reached out to NetEase last week offering to extend its partnership for another six months, though with the condition that the search for a new partner would continue.
And this offer was rejected by NetEase, who stated: "Considering the non-reciprocity, unfairness and other strict conditions attached to the cooperation, the parties could not reach an agreement in the end."
Games like World of Warcraft being frozen in China are bound to be a significant blow to Activision Blizzard, and it comes as a surprise that such a capable company didn’t know better. As China’s second-biggest games company, NetEase has been imperative in keeping so many of Activision Blizzard’s games live in the country for years – a fact the latter perhaps hadn’t realised until it was too late.
Equally, Netease does seem to have a habit of falling out with its playmates; a recent Riot lawsuit claims that the Chinese giant infringed Valorant’s copyright.
Meanwhile, NetEase and Tencent plan to resurrect certain discontinued games to keep the money flowing.