NetEase's Marvel Rivals, a resounding success with ten million players in its first three days and millions in revenue for NetEase, almost never saw the light of day. A new Bloomberg report reveals that CEO William Ding nearly canceled the game due to reservations about using licensed intellectual property.
This near-cancellation reflects a broader strategy shift at NetEase. Ding is streamlining operations, implementing job cuts, studio closures, and scaling back overseas investments. The aim is to create a more focused portfolio, counteracting recent growth stagnation and bolstering competition with giants like Tencent and MiHoYo.
Bloomberg sources indicate that Ding's reluctance to pay licensing fees for Marvel characters nearly led to Marvel Rivals' demise. He reportedly attempted to convince developers to switch to original character designs. This aborted cancellation reportedly cost NetEase significant funds, yet the game launched to considerable success.
The restructuring continues. Recent layoffs at the Marvel Rivals Seattle team, attributed to "organizational reasons" by NetEase, underscore this trend. Over the past year, Ding has halted investments in foreign projects, reversing previous substantial investments in studios such as Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests Ding prioritizes games projected to generate hundreds of millions annually, although NetEase denies using arbitrary revenue targets for game viability.
Internal challenges are also highlighted in the Bloomberg report. Ding's leadership style, characterized by rapid decision-making, frequent changes of mind, pressure on employees to work excessive hours, and the appointment of recent graduates to key leadership positions, is reportedly causing internal friction. The frequency of project cancellations raises concerns about NetEase's potential lack of new game releases in China next year.
NetEase's reduced investment in game development coincides with ongoing instability in the global gaming industry, particularly in Western markets. Recent years have witnessed widespread layoffs, cancellations, and studio closures, coupled with the underperformance of several high-budget, high-profile titles.
