NetEase's Marvel Rivals has taken the gaming world by storm, amassing an impressive ten million players within just three days of its launch. The game has also proven to be a lucrative venture for NetEase, generating millions in revenue in the subsequent weeks. However, a recent report from Bloomberg sheds light on a near-miss for the game's existence, as NetEase CEO and founder William Ding reportedly considered canceling it due to his hesitation in utilizing licensed intellectual property (IP).
According to Bloomberg, Ding is steering NetEase towards a more streamlined operation, involving job cuts, studio closures, and a cessation of overseas investments. This strategic shift aims to combat recent declines in growth and to better compete with industry giants like Tencent and MiHoYo. As part of this restructuring, Marvel Rivals almost didn't make it to the market. Sources told Bloomberg that Ding was reluctant to pay for Marvel's licensed characters, preferring instead to use original designs. The attempted cancellation reportedly cost NetEase millions, but the game ultimately launched to its current success.
Despite the triumph of Marvel Rivals, the downsizing at NetEase continues. Recently, the Marvel Rivals Seattle team was let go, with the company citing "organizational reasons" for the layoffs. Over the past year, Ding has also pulled back from investing in overseas projects, previously involving companies like Bungie, Devolver Digital, and Blizzard Entertainment. Ding reportedly holds the view that games not capable of generating hundreds of millions annually are not worth pursuing, although a NetEase spokesperson clarified to Bloomberg that the company does not impose arbitrary financial thresholds for new game viability.
Internally, NetEase is facing challenges as well, according to workers speaking to Bloomberg. They describe Ding's leadership style as volatile, marked by rapid decision-making and frequent changes of mind. Staff have felt pressured to work late hours, and recent graduates have been placed in significant leadership positions. The frequency of project terminations under Ding's direction has led to concerns that NetEase might not release any new games in China next year.
NetEase's retreat from game investments coincides with a period of uncertainty in the global gaming industry, particularly in Western markets. The past few years have been marked by widespread layoffs, project cancellations, and studio closures, along with the underperformance of several high-budget, high-expectation titles.
