NetEase Founder Nearly Cancels Marvel Rivals Over IP Concerns

NetEase's Marvel Rivals has quickly emerged as a blockbuster, attracting an impressive ten million players within just three days of its launch and generating substantial revenue for the developer in the subsequent weeks. However, a recent Bloomberg report reveals that NetEase CEO and founder William Ding was on the brink of canceling the game due to his hesitance to utilize licensed intellectual property (IP).

The report sheds light on the current strategic shifts at NetEase, where Ding is aggressively downsizing operations. This includes cutting jobs, shutting down studios, and halting overseas investments. The aim is to streamline the company into a leaner, more focused entity capable of countering a recent dip in growth and better competing with industry giants like Tencent and MiHoYo.

Bloomberg's sources indicate that the decision to nearly cancel Marvel Rivals stemmed from Ding's reluctance to pay for the use of Marvel's licensed characters. He reportedly attempted to convince artists to switch to original designs instead. This near-cancellation reportedly cost NetEase millions, yet the game went on to achieve its current success upon release.

Despite the triumph of Marvel Rivals, NetEase's downsizing efforts persist. Earlier this week, the Marvel Rivals Seattle team was laid off, with the company citing "organizational reasons." Over the past year, Ding has also ceased funding overseas ventures, following previous significant investments in Japanese and Western studios such as Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests Ding's stance is that games not capable of generating hundreds of millions annually are not worth pursuing, though a NetEase spokesperson clarified to Bloomberg that the company does not apply "arbitrary blanket numbers" to determine new game viability.

Bloomberg's interviews with NetEase employees paint a picture of internal turmoil, largely attributed to Ding's unpredictable leadership style. Employees describe him as making swift decisions and frequently changing his mind, pressuring staff to work long hours, and recently promoting numerous recent graduates into key leadership positions. It is also alleged that Ding has canceled so many projects that NetEase might not release any new games in China next year.

NetEase's retreat from gaming investments coincides with a period of heightened uncertainty in the global gaming industry, particularly in the West. The sector has witnessed consecutive years of widespread layoffs, project cancellations, and studio closures, alongside the underperformance of several high-cost, high-profile games that failed to meet company expectations.