In November, Activision Blizzard ended its 14-year partnership with Netease. The reason was that Netease suggested it could influence Chinese regulators over Microsoft’s planned acquisition of Activision. Activision interpreted this as a threat and ended the partnership. The two companies were negotiating to renew the contract and Netease wanted to move on to a licensing agreement.

Bobby Kotick feared this would affect regulatory discussions surrounding the Microsoft acquisition. In response, Netease’s CEO said they could influence the Chinese government on the acquisition. Kotaku contacted Kotick’s representative but received no comment.

The Times claimed that Activision executives believed NetEase had “threatened” Kotick. After the meeting, Activision offered NetEase the licensing deal if the company paid $500 million up front to offset the cost of regulatory complications. NetEase reportedly rejected the offer, calling it “commercially illogical”. The Kotaku portal tried to talk to them, but received no helpful feedback or response.

Selling games in China is a drastic process compared to other markets. Both domestic and foreign game publishers have to deal with China’s National Press and Publication Administration (NPPA), which approves individual titles that could be sold to Chinese consumers. From July 2021 to April 2022, the agency stopped approving titles altogether, putting nearly 14,000 game companies out of business.

The two companies had also had previous disputes between them. In 2018, NetEase invested $100 million in Bungie, a move Kotick reportedly hated. Activision had been a partner on Destiny and Bungie was behind in developing new content for its popular shooter, so Kotick felt the NetEase infusion might distract the developer from dealing with that task. That same year, NetEase invested in a game company founded by a former Activision employee. The Times reported that this investment prompted Kotick to consider ending his association early.

“It is unfortunate that Activision Blizzard continues to harass and mock companies and regulators around the world, making baseless accusations to distract everyone from their real issues,” NetEase wrote in a statement to Kotaku. “Our recent negotiations have revealed a clear mismatch between the two companies, both in terms of business and corporate values, and we have decided that it is not in our long-term interests to serve the short-term objectives. term of the current direction of Activision Blizzard or to deviate from our founding principles.

“What worries me the most now is that those friendships are disappearing,” he continued.

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