Chinese games maker NetEase said on Wednesday it had rejected a proposal by Activision Blizzard to extend its long-standing partnership by six months as the US games developer looks for a new partner. NetEase said the proposal was “commercially illogical” and accused the US company of “seeking a divorce but still staying connected,” in a rare public display of bitterness between the two gaming giants. Blizzard announced in November that it was ending its 14-year partnership with NetEase — sending shockwaves across the industry as the partnership was widely viewed as one of the most lucrative in the video game space.
The companies had not been able to agree on the essential terms of cooperation, and there were blows such as World of Warcraft will not be available in China, the world’s largest gaming market, starting January 23.
NetEase called blizzard Last week, the company came forward with an offer to extend the partnership by six months, but also made it clear that it would not stop negotiations with other potential partners.
“Faced with the lack of reciprocity, injustice and other strict conditions attached to the cooperation, the parties failed to reach an agreement in the end,” China’s second-largest gaming company said in a statement.
The exact sticking points that thwarted the deal, which began in 2008 and was renewed in 2019, remain unclear.
A person close to Blizzard said the dispute that scuppered the extension revolved around commercial terms rather than data issues, as some media outlets had reported.
The person, who declined to be named due to the sensitivity of the issue, said NetEase had proposed making structural changes to the partnership that would affect Blizzard’s control of its intellectual property (IP).
In its statement late Tuesday, NetEase said it had never asked for control of intellectual property from Blizzard or any partner other than a publishing company in the past 14 years.
“All use and licensing of Blizzard’s intellectual property has been done in accordance with the terms of the Agreement and with Blizzard’s approval and consent,” it said.
Activision Blizzard did not immediately respond to a Reuters request for comment.
With the end of the partnership, Blizzard currently no longer has a Chinese publisher. Unlike other countries, foreign game companies usually need a Chinese publisher before they can publish games in China.
NetEase rose to become a gaming giant by releasing Blizzard games in China, among other things. Since then, the company has intensified its own game development capabilities, with its own games now accounting for more than 60 percent of sales.
© Thomson Reuters 2023
