The sales space of Blizzard Entertainment on the Chinajoy Expo in Shanghai, China, on Aug. 2, 2019.
CFOTO | Future Publishing | Getty Images
Activision Blizzard and Chinese gaming agency NetEase are ending their 14-year licensing settlement, a transfer that may end in hit recreation franchises like World of Warcraft and Overwatch shutting down in China.
The deal, which was first struck again in August 2008, will now expire in January 2023 after the 2 companies have been unable to agree on renewal phrases. World of Warcraft, a massively multiplayer on-line recreation, is massively common in China.
NetEase’s Hong Kong-listed shares plunged 9% Thursday.
In an announcement, NetEase CEO William Ding mentioned Blizzard and NetEase had “material differences on key terms” in deal negotiations.
“We are honored to have had the privilege of serving our gamers over the past 14 years and have shared many precious moments with them during that time,” Ding mentioned.
“We will continue our promise to serve our players well until the last minute. We will make sure our players’ data and assets are well protected in all of our games.”
It means Chinese players will now not have the ability to play titles from blockbuster franchises reminiscent of World of Warcraft, StarCraft, Hearthstone, Overwatch and Diablo, which U.S. tech big Microsoft is ready to accumulate in a $69 billion deal to purchase Activision Blizzard.
New Blizzard recreation gross sales shall be suspended in mainland China “in the coming days,” Blizzard mentioned. Upcoming releases for World of Warcraft: Dragonflight, Hearthstone: March of the Lich King and season 2 of Overwatch 2 will proceed as regular later this yr, it added.
“We’re immensely grateful for the passion our Chinese community has shown throughout the nearly 20 years we’ve been bringing our games to China through NetEase and other partners,” mentioned Blizzard President Mike Ybarra.
“Their enthusiasm and creativity inspire us, and we are looking for alternatives to bring our games back to players in the future.”
NetEase mentioned web revenues and web earnings contribution from the licensed Blizzard video games “represented low single digits” as a portion of its general gross sales and earnings in 2021 in addition to the primary 9 months of this yr.
The ending of the association “will have no material impact on NetEase’s financial results,” the corporate added.
The publishing of the hotly anticipated cellular and PC recreation Diablo Immortal in China won’t be affected as it’s lined by a separate settlement between the companies.
The recreation’s launch had been delayed past June 23 after points with community and efficiency optimizations.
Thursday’s transfer comes at a delicate time for the Chinese video games trade which is solely simply rising from a months-long freeze of approvals from regulators. The trade has confronted intense scrutiny as a part of a broader regulatory tightening on China’s home know-how corporations.
— CNBC’s Arjun Kharpal contributed to this report.
Source: www.cnbc.com”