SINGAPORE—
Activision Blizzard Inc.
ATVI -1.17%
said that
NetEase Inc.,
NTES -1.44%
its longtime partner in China, has refused its offer to extend a licensing partnership and that it is in talks with several videogame companies to find a new partner in the country.
Blizzard Entertainment Inc., an Activision subsidiary, said Tuesday that it proposed to NetEase a six-month extension to the partnership that is set to expire next week. The licensing partnership has brought Blizzard’s globally popular videogames such as “World of Warcraft,” “Diablo III” and “Overwatch” to the Chinese market through NetEase.
Mike Ybarra,
president of Blizzard Entertainment, met NetEase executives in China last week to discuss a possible extension of the partnership, people familiar with the matter said.
NetEase didn’t accept Blizzard’s proposal, Blizzard said in a statement posted on its Weibo social-media account.
NetEase declined to comment.
In November, Blizzard and NetEase said they planned to shut the services—Blizzard said on Jan. 23. The announcement came after months of negotiations soured around control of intellectual properties and player data, The Wall Street Journal has reported.
NetEase Chief Executive
William Ding
said then that “Activision Blizzard’s requirements on some key partnership terms that relate to sustainable operations and core interests of the Chinese market and players are unacceptable to us.”
China’s videogame sector has been facing tighter government oversight and a slowing economy. Last year, the market shrank by 10% from a year earlier to around $40 billion, the first decline in more than a decade, data from market tracker CNG showed.
Still, uncertainty is decreasing. Following a months-long freeze that started in July 2021, authorities have been issuing publication licenses for new videogame titles, including resuming approvals for foreign titles in December.
The 14-year partnership has helped Blizzard access the world’s biggest mobile-game market, while bringing Blizzard’s global hits to NetEase. Sentiment visible on Weibo, a Twitter-like social-media platform popular in China, has been largely critical of Blizzard.
NetEase last week launched a version of its multiplayer role-playing game “Justice” with features that NetEase said are similar to Blizzard’s “World of Warcraft.” NetEase also said the latest version of “Justice” was designed for Chinese players of “World of Warcraft” that is set to close. NetEase said it started developing the version after the negotiations with Blizzard failed.
Blizzard said it would launch a tool Wednesday for players of “World of Warcraft” in China to download their gaming progress for future use. NetEase earlier said player data will be stored and handled in accordance with laws.
Write to Raffaele Huang at [email protected]
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