New report details breakdown of NetEase Blizzard partnership

New report details breakdown of NetEase Blizzard partnership

Blizzard's 14-year-long relationship with Chinese games firm NetEase reportedly broke down after the two companies were unable to come to an understanding. 

That's according to the New York Times, which writes that misunderstandings and what were deemed to be threats between the two games giants led to the long-running partnership breaking down. NetEase reportedly tried to make its relationship with Activision Blizzard compliant with new regulations in the country.

Activision Blizzard apparently objected to a proposal that would see it license its games to NetEase instead of both companies handling the publishing of games in order to give the Chinese company more control over regulatory compliance. The World of Warcraft giant thought that NetEase was using local regulation to achieve a better deal. Activision Blizzard later said it would accept the licensing offer if the Chinese firm were to pay it $500 million upfront. This is apparently where NetEase describing Activision's demands as "rude and unreasonable, inappropriate and commercially illogical" came from.

As if all this wasn't enough, execs at Activision Blizzard felt that NetEase boss William Ding had threatened Bobby Kotick, reportedly suggesting that the company could have a say in how Chinese regulators landed on Microsoft's acquisition of the Call of Duty maker. This is something that NetEase denies, with spokesperson Alexandru Voica saying that Activision Blizzard continues to "harass and taunt companies and regulators worldwide" over the deal.

It also seems that NetEase investing in Bungie back in 2018 – as well as throwing cash behind a game studio set up by a former Activision staffer – put a strain on the relationship.

Responding to the claims laid out in the NYT's reporting, Activision VP Michael Lee said that the company's time in the Chinese market had been "very positive" pointing to the firm's relationship with Tencent.

“While it’s true that the partnership you’re describing took a surprising and troubling turn, it’s important to recognize that this was an anomaly,” Lee said.

NetEase's Voica said that the company had moved on from the deal, adding “we suggest Activision Blizzard do the same.”

Disclaimer: Alex Calvin is a freelance writer who has worked with NetEase in the past

PCGamesInsider Contributing Editor

Alex Calvin is a freelance journalist who writes about the business of games. He started out at UK trade paper MCV in 2013 and left as deputy editor over three years later. In June 2017, he joined Steel Media as the editor for new site In October 2019 he left this full-time position at the company but still contributes to the site on a daily basis. He has also written for, VGC, Games London, The Observer/Guardian and Esquire UK.