NetEase Founder Reportedly Almost Canceled Marvel Rivals Because it Didn't Use Original IP

NetEase's Marvel Rivals: A Near-Miss Cancellation and the Shifting Sands at NetEase

NetEase's Marvel Rivals has been a resounding success, attracting ten million players within three days of its launch and generating millions in revenue for the developer. However, a recent Bloomberg report reveals that NetEase CEO William Ding nearly canceled the game due to his initial reluctance to utilize licensed intellectual property.

This report sheds light on NetEase's current strategic restructuring. Ding is implementing cost-cutting measures, including job reductions, studio closures, and a withdrawal from overseas investments. The aim is to create a more focused portfolio to counter recent growth stagnation and compete effectively against industry giants like Tencent and MiHoYo.

This streamlining almost resulted in the cancellation of Marvel Rivals. Sources claim Ding initially resisted the licensing costs associated with Marvel characters, attempting to convince developers to use original character designs instead. This near-cancellation reportedly cost NetEase millions, yet the game ultimately launched to considerable success.

Despite this success, the restructuring continues. The recent layoff of the Marvel Rivals Seattle team, attributed to "organizational reasons" by NetEase, underscores this ongoing process. Furthermore, Ding has halted investments in overseas projects, reversing a previous strategy of significant investment in studios such as Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests Ding prioritizes projects with the potential to generate hundreds of millions in annual revenue. However, a NetEase spokesperson clarified that the company does not employ arbitrary revenue targets for assessing game viability.

Internal challenges at NetEase have also been highlighted by employees speaking to Bloomberg. These accounts portray Ding as a volatile leader, characterized by rapid decision-making, frequent changes of mind, pressure on staff to work excessive hours, and a recent trend of appointing recent graduates to senior leadership positions. The frequency of project cancellations is reportedly so high that NetEase may not release any new games in China next year.

NetEase's retreat from game investments coincides with a period of considerable uncertainty within the global games industry, particularly in Western markets. Recent years have witnessed widespread layoffs, cancellations, and studio closures, alongside the underperformance of numerous high-budget, high-profile titles.