A recent report from the New York Times has detailed what supposedly happened between Activision Blizzard and NetEase leading up to the announcement of the two parting ways.
What happened between Activision Blizzard and NetEase?
October call
According to the report, a call took place in October between Activision Blizzard and NetEase to discuss the future of their 14-year partnership, but both apparently left with “drastically different interpretations of what had been said,” according to four people close to the situation, and based on a document the NYT had seen.
Tensions building up
The report noted that tensions had been building between the two companies before the contract renewals, with NetEase executives believing that Kotick had made “unreasonable demands” over the years.
Investment in Bungie
In 2018, NetEase invested $100 million into Bungie to make non-Destiny games, which Kotick apparently felt unhappy with as Bungie was behind schedule on making Destiny content.
Threats and accusations
October’s call saw Kotick talk with NetEase chief executive William Ding and other executives about the antitrust regulators investigating Microsoft’s potential acquisition of ABK, and apparently at some point in the conversation–which took place between translators–Activision executives noted they believed Ding “threatened” Kotick.
Executives believed that NetEase could sway the Chinese government–which was reviewing the acquisition at the time–to potentially block the deal, depending on the outcome of any licensing deals between Activision Blizzard and NetEase. Alexandru Voica, a NetEase spokesperson, denied that Ding had threatened Activision.
Unable to reach an agreement
Activision Blizzard did later offer NetEase a deal to extend the contract, but the latter declined, writing “Considering the unequal, unfair, and other conditions attached to the cooperation, the two parties failed to reach an agreement in the end.”
What is the impact of this split between Activision Blizzard and NetEase?
World of Warcraft unavailable in China
In January, World of Warcraft became unavailable in China due to the two not being able to make an agreement.
No Activision Blizzard games for Chinese gamers
Gamers in China are currently unable to play any Activision Blizzard games–aside from Diablo Immortal, which has a separate deal–though the company is planning to return to the region, and is in talks with other Chinese companies to distribute its games.
What was the reason behind the split?
Bobby Kotick felt threatened
According to a recent report, the split between Activision Blizzard and NetEase was in part due to ABK’s CEO Bobby Kotick feeling “threatened.”
Unreasonable demands
NetEase executives also believed that Kotick had made “unreasonable demands” over the years, which led to tensions building up before the contract renewals.
Conclusion
The split between Activision Blizzard and NetEase was a result of a call in October 2020 where both companies left with different interpretations of what had been said. Tensions had been building up before the contract renewals, and NetEase executives believed that Kotick had made unreasonable demands over the years. The split has resulted in World of Warcraft becoming unavailable in China and Chinese gamers being unable to play any Activision Blizzard games except for Diablo Immortal. Activision Blizzard is planning to return to the Chinese market, but is in talks with other Chinese companies to distribute its games.
