Led by a "fool" CEO, Blizzard broke up with NetEase "capriciously" for a year, but what awaits it is the more difficult fate of layoffs, hard to find Pan Xia and so on. As the villains who cooperated with the company were offline, Blizzard and NetEase finally got back together.
Author | Wu Tian
Source | City boundary
A "secret" that has been circulating for several months has finally been settled, and the "electronic urn" of the players of the World of Warcraft national service will be restarted. One year and two months ago, millions of Warcraft players who were deeply hurt by Blizzard "Scum Man" will return to the land of Azeroth this summer.
In the morning of April 10, Blizzard Entertainment, Microsoft Games, and NetEase jointly announced that Blizzard's games will return to the mainland market in succession this summer. At the same time, Microsoft Games announced that it had reached an agreement with NetEase to try to bring new NetEase games to Xbox and other platforms.
As soon as the news was announced, social media was immediately ignited. Ten topics including "Blizzard official announced the return", "NetEase Blizzard remarried", "Blizzard national service player data is completely preserved", "Hearthstone legend is back" and other topics hit the microblog hot search.
More than a year ago, the drama of "breaking up" between the two sides was in uproar. In October 2023, Microsoft completed the acquisition of Activision Blizzard. In December, it was recognized that the "villain" who had been working with Blizzard and NetEase for 15 years had been spoiled. The former CEO of Blizzard, Caudique, left his post, and the compound "scandal" between Blizzard and NetEase in the industry would be heard all the time.
Although it is reported in the industry that Microsoft has approached Tencent, Alibaba, Byte and other buyers in many ways this year, after a round trip, NetEase is still the "right man" of Blizzard.
Now, this popular reunion has also ushered in a happy ending. On April 9, Netease rose 3.76% in the US stock market. At the opening on April 10, Netease Hong Kong shares continued to rise.
More than a year has passed since Blizzard left the domestic market.
On November 17, 2022, many domestic players of World of Warcraft were thrown cold water by a "stop service" statement of the parent company Activision Blizzard. Activision Blizzard said that due to its failure to renew the license agreement with NetEase, the company will suspend most of its Blizzard game services in China from January 23, 2023, including World of Warcraft, Hearthstone Legend, Watch Pioneer, StarCraft series, Diablo III and Storm Hero.
Subsequently, NetEase said that the company has been doing its best to negotiate with Activision Blizzard, hoping to promote the renewal of the contract. After a long time of negotiation, it is still unable to reach an agreement with Activision Blizzard on some key terms of cooperation.
On the day of Blizzard's announcement, NetEase fell 1.93% at the beginning of the trading, and continued to decline in the trading day, with a decline of more than 14%.
But in the year when Blizzard broke up with NetEase "willfully", what awaited it was a storm of layoffs after a larger acquisition.
On October 13, 2023, Microsoft finally took Activision Blizzard into its pocket with a sky high price of 68.7 billion dollars after 21 months of gaming with antitrust agencies. But on January 25 this year, less than four months after the formal completion of the acquisition, Microsoft announced that it would lay off 1900 people in the game department, accounting for about 8% of the total number of people in the game department. The employees involved were mainly distributed in Activision Blizzard, ZeniMax and Xbox teams.
Blizzard also found that it was not easy to find a new Jiepan Xia after leaving the old love NetEase.
"No one can catch the Blizzard family bucket". At that time, many gamers told "The Market" that "it is almost impossible to find a big game taker in China". Blizzard needs to find a new agent, which means that the other party needs to reapply for version numbers for at least 8 games. However, the approval process of import version numbers is long, and the number of approved versions is small, which makes it hard for domestic manufacturers to do well.
According to media reports, Blizzard has negotiated with Tencent, Alibaba, Byte and other game manufacturers over the past year about "the return of national service" cooperation, but none of them has followed.
However, after successive acquisitions, layoffs and CEO replacement, Blizzard is more aware that China, a fertile market, cannot be abandoned. The China Game Industry Report 2023 shows that in 2023, the actual sales revenue of the domestic game market will exceed 300 billion yuan for the first time, with a year-on-year growth of 13.95%. The number of game users reached 668 million, a record high.
At the same time when the backyard of Blizzard caught fire, NetEase was "waiting for work with ease" this year.
In fact, in the financial report of NetEase in 2021, the revenue of proxy games including Blizzard will only account for 9.5% of NetEase's revenue. In 2023, the year when he broke up with Blizzard, Ding Lei had a "fat year". NetEase's game revenue rose steadily, and its share price nearly doubled.
Driven by interests, Blizzard, which had led the break, has now become a party with a lower attitude.
▲ (Ding Lei, CEO of NetEase, Johanna Faries, CEO of Blizzard, and Phil Spencer, head of Microsoft's game business)
During the 2024 Spring Festival, Johanna Faries, the new president of Blizzard, took office on the same day. Blizzard and Tiger Teeth jointly launched a new program - "Blizzard 2024 Spring Festival Gala", and clearly wrote in the title: "Thanks for persevering - looking forward to return".
At the previous 2023 Blizzard Carnival, Mike Ybarra, then president of Blizzard Entertainment, also made it clear that there are millions of players in China who love Blizzard games. "All Blizzard people want to ensure that they can play our games. We are a global company. I hope we can spread all over the world, including China."
Back to the beginning of this year long, seething "breakup drama", Zhu Yuan, president of NetEase Game Global Investment and Cooperation, posted a post on LinkedIn saying that players felt sad, pointing out that this was "a fool's injury".
Zhu Yuan referred to the "fool" as Bobby Kotick, then CEO of Blizzard, who caused the source of the conflict between NetEase and Blizzard. He was once called the "Devil CEO" in the industry. During his tenure, he drove Blizzard old people away one by one. The remake game did not give high budget, and all the projects that did not make money were cut off. Under his leadership, the "creator culture" of Activision in its initial stage became all about "money". After 2021, the "fraternity culture" involving sexual scandals within the company will make Blizzard's reputation in the industry plummet.
According to foreign media reports, in the case of Blizzard breaking up with NetEase, at the instigation of Caudique, Blizzard asked NetEase to pay a sky high price of 500 million dollars to renew the contract, which not only increased the revenue and net profit sharing by more than 50% over the contract period of 2019-2022, In addition, Blizzard's game pricing should also adopt a global synchronization strategy (previously, the pricing of national service was generally about 20% lower than that of other regions in the world).
In addition, Coadick also asked NetEase to develop other Blizzard IP mobile games for global distribution according to the model of Diablo: Immortal, but NetEase only enjoys the market revenue share in China. At the same time, Blizzard requires NetEase to pay a huge deposit or advance fees to guarantee the completion of Article 2, otherwise it will be "punished".
Behind Blizzard's "unequal" treaty, it may be related to its urgent desire to find new performance growth. Since the 2022 fiscal year, Blizzard's revenue and net profit have declined all the way until the third quarter, but still much worse than the same period. From the performance in recent years, Activision Blizzard's revenue is also in the predicament of continuous decline.
When the two sides criticized each other, NetEase was obviously the party who "wronged" and "felt unwilling".
Not only on the official number of Eternal Sorrow, NetEase launched a live broadcast of the removal of the statue of Blizzard Warcraft's Bloody Roar Tomahawk. "We don't want what he left behind," which filled the players with anger and sadness. NetEase Coffee also launched a limited edition drink, "Blizzard Green Tea", at a price of 13 yuan (homophonic: to be scattered) in due course, and the poster said meaningfully: "After drinking this cup, it will be scattered."
NetEase is also trying its best to save the market when it is unwilling to do so: it has launched a "theme service of NetEase Veterans of Warcraft" for Warcraft players to build Cold Against the Water, to carry some of the forced loss of Warcraft players; The "Resurrection" out of service all-in-one card game "Mystery Duel" is regarded as a replacement for the "Hearthstone Legend".
With the official end of the "Microsoft's acquisition of Activision Blizzard" case, Caudique officially left the company in 2024 after 32 years of work. After the "villain" left office, some signs of Blizzard's "return" to the Chinese market began to emerge gradually.
In December last year, Morgan Stanley released an investment analysis report that predicted that Blizzard Entertainment is expected to return to the Chinese market, which may have a slight positive impact on Netease, a famous online game company in China. At the same time, the anchors of a series of Blizzard games (World of Warcraft, Hearthstone Legend), including Flaming Mouse and Brother Donkey, also revealed in the live broadcast room that Blizzard is about to return to the Chinese market.
At the end of 2023, the market heard several times that Blizzard and NetEase were going to mend fences. After the "NetEase Blizzard Composite" hit the hot search for many times, the stock prices of NetEase's US and Hong Kong stocks also rose in response.
From the beginning of this year, with the involvement of Microsoft, the industry reported that Blizzard NetEase's negotiations had progressed more smoothly.
In the financial report of the second quarter of fiscal year 2024, Microsoft included the performance of Activision Blizzard in the Xbox business department for the first time, making the revenue of the department increase by 61%, becoming the third largest business department of Microsoft, successfully surpassing the company's original business. This historic leap makes the Xbox business unit second only to Enterprise Cloud ($23.95 billion) and Office ($13.47 billion).
The "Diablo: Immortal" authorized by Blizzard and developed by NetEase, as well as the "Battle of Warcraft" independently developed by Blizzard, have all proved Blizzard's ability to attract money from mobile IP in the global market. Now, the dominance of Blizzard's game IP has fallen into the hands of Microsoft, and Activision Blizzard is also under the supervision of Microsoft's game business CEO Phil Spencer.
Spencer said that the biggest reason for Microsoft to acquire Activision Blizzard is that it has determined that it is the largest player in the mobile game field. If Microsoft cannot successfully enter the mobile game market, the company's importance in the game market will decline.
Microsoft Sword Finger Mobile, and NetEase and Microsoft have previously maintained a good cooperation relationship for many years because of acting as the national service of My World. Globally, NetEase's revenue in mobile games is second only to Tencent. And continuing to cooperate with NetEase is also the best choice for Microsoft to continue to promote the transformation of Blizzard IP mobile games.
However, one year after the break up, Blizzard players may have to wait for a while before they can happily return to Azeroth due to technical problems and the shock of Blizzard's ability to undertake layoffs.
For NetEase, all the games of Blizzard China together may not be as big as the single head products such as NetEase's Egg Boy Party. It may not need Blizzard back to support its product line. However, the return of Blizzard has a great effect on the brand image of NetEase - of course, it also has a positive impact on NetEase's stock price and market value - NetEase's stock price rose in response to the announcement of "remarriage".
With the announcement of the two officials, Blizzard NetEase's games are also "reconciled" at the speed of light.
NetEase announced that it would recast the "Blood Roar" sculpture that had been smashed before, and said: "NetEase and Blizzard artists will work together to design and cast a new Blood Roar sculpture. We will collect the minds and memories of players, integrate them into the design, and engrave the new Blood Roar. We will make the new Blood Roar a new keepsake for players, NetEase and Blizzard. This fall will never wear out. "
NetEase's Infernal Forever also took the opportunity to make a gesture, which was forwarded on Weibo and said: "I was offended before, and we paid for the money of Bloody Roar."
(Statement: This article only represents the author's view, not Sina.com's position.)
