2024.0410

Number of words in this article:3207, reading time is about 5 minutes

introduction：“商场之上没有永远的朋友，只有永远的利益。”

** Author| ** First Finance Liu Xiaojie

After experiencing an unseemly dispute of contract termination, Blizzard went around for another year. After being acquired by Microsoft, Blizzard chose to get back together with Netease.

On April 10, Blizzard China Weibo announced that Blizzard Entertainment and Netease announced today that they have reached an updated game distribution agreement based on more than 15 years of cooperation to bring Blizzard games back to national service players. At the same time, the official website also stated that game works will gradually return to the the mainland of China market starting this summer according to the updated game distribution agreement.

In fact, news of the reunion of the two companies has been spreading since December last year. At that time, it was reported that Blizzard had negotiated with many domestic game manufacturers about the "return of national services" and finally chose to resume cooperation with Netease. First Financial reporters once asked Netease and Blizzard for confirmation, but both said that there was no reply.

The combination of Blizzard and Netease seems unexpected and reasonable in the market. Game industry analyst Zhang Shule previously told First Finance that choosing Netease is the shortest path for Blizzard to reopen its national services and one of the best options for Microsoft to transform Blizzard's IP mobile games."There are no eternal friends in the mall, only eternal interests. The departure of Activision Blizzard CEO also gives a step in a sense."

Why is it so eager to return? Zhang Shule said that Blizzard will not return to the Chinese market, and its popularity will drop exponentially."Ding Lei is waiting for the price this cooperation. Microsoft is very anxious, so all kinds of benefits should be obtained by Netease, and subsequent in-depth cooperation will also have a good start."

Compound action is already in place

** **

On April 9, affected by "compound" rumors, Netease's Hong Kong stocks (09999) rose 4.13%. As of today's (April 10) press release, Netease's share price rose 1.397%, at HK$159.7/share, with a total market value of HK$514.8 billion.

Just on April 9, there was already a lot of news that Blizzard would officially announce the return of national services on the 10th, and the partner was Netease. At the same time, a scene picture of a suspected conversation between Netease Blizzard and Blizzard leaked on the Internet. Among them, Netease CEO Ding Lei showed a clear face, and the other person with his back to the camera was rumored to be Blizzard's new president Johanna Faries.

Today's official announcement also showed a photo of the management of both parties. From left to right are Ding Lei, Johanna Faris and Phil Spencer, CEO of Microsoft Games.

According to this announcement, the updated game publishing agreement will cover all national service games played by players under the previous agreement:World of Warcraft, Hearthstone, and other series games based on Warcraft, Overwatch, Diablo and StarCraft. Based on more than 15 years of cooperation in the past, Blizzard and Netease said they are working hard to formulate a return plan and will announce more details in the future.

In addition, Microsoft Games and NetEase have reached an agreement to try to bring new NetEase games to Xbox and other platforms.

Johanna Farris said that Blizzard colleagues are very happy to partner with Netease again."Thank you very much to the Chinese player community for the enthusiasm they have shown for Blizzard games over the years. We will focus on bringing our gaming world back to players with excellent quality and dedication. "

Ding Lei said in the announcement,"I am very happy to be able to open the next chapter based on trust and mutual respect to serve our users in this unique community we have jointly built. "At the same time, Spencer mentioned that Blizzard's legendary games will be returned to China and will also explore how to bring more new games to Xbox.

Before the announcement, the probability of market speculation about the combination of Blizzard and Netease was also high. In addition to industry insiders 'revelations, Netease's various actions over the past period of time are also a sign.

On the one hand, in the player community "Netease God" under Netease Games, the community for the "World of Warcraft" game has been re-launched and will be updated on December 21, 2023. First Financial Reporter checked the relevant forums and found that this community has no content before December 21. Industry insiders said that the last news from this community was that Netease had stopped representing World of Warcraft, but this news is no longer visible at present.

Previously, due to the cancellation incident, the Shanghai "NetEasy" team responsible for the operation of Blizzard Games 'national service was reportedly disbanded. According to Sky Eye, Netease established NetEase (Shenzhen) Network Co., Ltd. in November last year. Wang Yi, senior vice president of Netease who is responsible for the global distribution of Netease games, serves as the company's legal person and general manager. In December last year, the service number IP of "Netease Blizzard Customer Service Center" was changed from Shanghai to Guangdong.

After the dispute over the termination of the contract, disputes between Netease and Blizzard were brought to court more than once. At the end of April 2023, ShanghaiNet Yi sued Blizzard Networks, arguing that it violated a series of licensing agreements and demanded a refund of 300 million yuan in arrears. In May, Blizzard Entertainment sued Netease for infringement and unfair competition. However, public information shows that the court hearing of the contract dispute case between Shanghai NetEase v. Blizzard Entertainment ([2023] Hu 0115 Minchu No. 65437), which was originally scheduled to open on January 18 this year, has been cancelled. The Shanghai City Pudong New District People's Court stated that the reason for the cancellation of the hearing was that the plaintiff withdrew the complaint.

Why Netease?

** **

In the previous dispute between Netease and Blizzard, the two sides had gone through many rounds of public responses and tugging. This was an undignified "breakup."

On November 17, 2022, Blizzard suddenly announced that its licensing agreement with Netease would expire on January 23, 2023. In Netease's view, this was a "backstabbing" act that had not been notified in advance. Since then, Blizzard stated that it hoped to renew its contract with Netease for six months based on the existing agreement and framework and was rejected. Netease fiercely fought back in an official statement,"Blizzard's proposal is arbitrary, inappropriate and inconsistent with business logic," calling it "over-confident" and "taking whatever you want, riding a donkey to find a horse, and never leaving you for a divorce." At one time, Netease Canteen once launched new dishes,"Blizzard Green Tea Rapeseed" and "Blizzard Green Tea Party Dish", to ridicule Blizzard.

After such a decisive breakup, how did Blizzard and Netease "get back together"? Perhaps the biggest opportunity behind it is that on October 13, 2023, Microsoft's $68.7 billion acquisition of Activision Blizzard cleared the last obstacle-it was recognized by the British Competition and Markets Authority (CMA).

After Blizzard took over to Microsoft, there is a possibility that its games will return to national service. On the other hand, Bobby Kotick, CEO of Activision Blizzard, who previously played the "chief culprit" in Netease Blizzard's "breakup" incident, officially stepped down at the end of last year, which may also be the basis for renegotiating cooperation.

After officially breaking up with Netease in January 2023, the industry has circulated several versions of the next partner, including Tencent, Byte, Station B, Perfect World, Mihayou, Jiucheng and other companies that have been rumored to be Blizzard's potential parties, but no company has come forward to officially announce accepting this hot "golden potato". Just in November last year, the scope of potential cooperation partners was further narrowed. Blizzard was rumored to have negotiated with a number of game manufacturers, including Netease and Tencent, on the return of national services, but no clear response was made from all parties.

Re-establishing cooperation, what are Netease's advantages? Zhang Shule told First Finance that existing servers, teams that can be recalled, and the restart of version numbers with relatively quick approval are all Netease's advantages and a shortcut for Blizzard's national service restart.

Industry insiders believe that Netease has represented Blizzard's games for 14 years and keeps players 'game data. Only Netease can quickly restart the service. If Netease ultimately represents Blizzard games, the game server is expected to open within 3 months. Other manufacturers may need to wait longer due to factors such as re-applying for version numbers.

Another point worth noting is that if Blizzard Entertainment changes its domestic agent, it will face the problem of reiterating the version number. According to Article 5 of the "Notice of the Three Departments of the State Council on Further Strengthening the Management of Online Games", if an online game that has undergone pre-approval or import approval by the General Administration of Press and Publication changes its operating unit, the pre-approval or import approval procedures must be re-applied. This means that if Blizzard has a new agent, it will probably need to re-apply for the game version number, which is currently not easy to obtain.

Zhang Shule believes that the greatest value of Activision Blizzard is its global influence IP, which can become the best games in the field of mobile games. Microsoft lacks experience in mobile game research and development, but Netease does. This is the foundation of this cooperation, learning from each other's strengths.

"Netease wants IP and Microsoft wants mobile games. Once the cooperation is effective, it will be the first to act on China, the world's largest game market, to rejuvenate Blizzard's game IP." Zhang Shule said that for Netease, the addition of Blizzard games will not have much impact on its overall game landscape. However, based on Microsoft's idea of entering mobile games, Netease may obtain mobile games including but not limited to Blizzard IP in the future. Mobile game development opportunities. For Microsoft, it is a boost to the field of mobile games. It may also work with Netease to explore the possibility of multi-terminal data interoperability games in console games, PC games and mobile games. The announcement also mentioned that Microsoft Games and NetEase reached an agreement to bring new NetEase games to Xbox and other platforms.

However, business wars come and go, and in the end it is the players who suffer. If Blizzard's national service games return, will players still buy it?

As a "hardcore" player in World of Warcraft for nearly 20 years, Wanyuan said,"Players are the parents of Netease and Blizzard. The two sides directly quarreled for their own interests. They suspended service for a year and a half and then regrouped with officials. The capital of both companies has never considered players." When the service was closed before, Wanyuan's account had dozens of mounts worth thousands of yuan, as well as countless equipment and achievements, which condensed his countless efforts."There will be no time to play in the future. I will completely bid farewell to youth." He said.

Zhang Shule also believes that in China, the core players of Blizzard Games have entered middle age and lack of time and energy. Now that it is returning, it will still be an old game in the short term. If you buy it, users will continue to decline. However, the biggest change brought about by this remarriage may be technology sharing and market sharing. Netease works with Microsoft to develop both domestic and overseas markets through possible Blizzard IP mobile game research and development, and may have a strategic alliance with Microsoft on multi-terminal interoperability (hosts, PCs and mobile games) to jointly tackle technical problems and jointly address global strategies.

**