What happened to Blizzard and Netease?

Blizzard Entertainment announced that due to the failure to renew the license agreement with Netease, the company will suspend most Blizzard game services in China, including World of Warcraft, Hearthstone, warcraft 3: Remastered Edition, Watching Pioneer, StarCraft Series, diablo 3 and Storm Hero. The authorization agreement signed by both parties will expire on June 23, 2023.

Blizzard is an old company in the game industry. Its World of Warcraft has been running for 17 years, and it is one of the longest-lived online games. But with the announcement, the adventure of the adventurers who were active in Azeroth really ended this time.

On the same day, Netease released the third quarterly report, revealing that the net income of Netease in this quarter was 24.4 billion yuan, and the net income of games and related value-added services was 65.438+087 billion yuan, which continued to grow year-on-year.

Among them, Netease also emphasized that in 20021and the first nine months of 2022, the percentage of net income and net profit contributed by the game from Blizzard to Netease was in low single digits. The expiration of the authorization will not have a significant impact on Netease's financial performance.

Netease said that it will continue to perform its duties, fully protect the rights and interests of players, and serve China Blizzard players until the last moment.

This seems a little sad. The two sides used to go hand in hand, but now they are different. Many players feel that World of Warcraft is about to close, and the veterans are not dead, but dying.

Just like on the well-known forum NGA, some netizens wrote:

"I have witnessed the rise and fall of countless games. ...

Also witnessed the birth and death of countless agents. ...

For more than a decade, the greed of game companies has never changed.

The appearance of this announcement here confirms this point. "

Behind the emotion, the two sides seem to have embarked on two different paths.

Reason of break up

While many players are shocked, they can't help but explore the real reason why Blizzard Netease "broke up".

According to informed sources, the main reason for the termination of cooperation between the two parties is that the price has not been negotiated, and Blizzard's policy has put forward high-priced renewal conditions, which Netease cannot accept.

According to Tiger Sniff, the new conditions given by Blizzard are:

1. Compared with the contract period of 20 19~2022, Blizzard's revenue and net profit increased by more than 50%, and Blizzard's game pricing was synchronized globally (previously, the national service pricing was generally about 20% lower than other regions);

2. Netease develops other IP mobile games of Blizzard for global distribution according to the model of Diablo: Eternal Life, but only enjoys the domestic market revenue share; Netease needs to pay a huge deposit or prepaid fee as a guarantee, otherwise it will be "punished".

3. Activision Blizzard put forward a binding clause that cannot be promised for the domestic game version number problem.

An industry insider said that Blizzard can give such conditions, which can be said to be unclear about its embarrassing position now, and it is clear that its game is going downhill, and it is still a big mouth.

In addition, at the beginning of the year, Microsoft bought Activision Blizzard for $68.7 billion, and the entry of Microsoft put great pressure on Blizzard with poor performance in recent years. This may also be the reason why they are eager to make such unreasonable demands at this node.

Blizzard is not the blizzard of that year.

Come to think of it, blizzard is not the blizzard of that year.

Blizzard these games have basically reached the end of the life cycle, and the momentum now is far less than in the past. Real-time strategy games such as StarCraft have been completely replaced by MOBA games, storm heroes are completely indifferent, and the popularity of watch pioneers is crumbling.

Nowadays, young people don't recognize blizzard. Are playing the glory of the king and LOL. They are all playing with the original god. Blizzard games are more about the youthful feelings of middle-aged uncles in their thirties and forties.

According to the monthly activity data disclosed in the Blizzard Financial Report, some players made a statistical chart of the monthly activity of Blizzard players. The monthly activity of blizzard users dropped from Q2 4600 million in 20 17 to Q2 2600 million in 202 1.

In addition, the reputation of players for Blizzard games is also declining. For example, after Blizzard released the remake of warcraft 3 in early 2020, over 20,000 players gave 0.5 points (full score 10) on Metacritic.

At the same time, players of old products are losing, word of mouth is declining, and Blizzard's new product research and development can't keep up. Not only has no new IP been launched for five consecutive years since 20 17, but also the much-anticipated Watch Pioneer 2 and Diablo 4 have repeatedly skipped tickets. Even under the influence of epidemic and other factors, the carnival that Blizzard players look forward to most every year has been suspended from 202 1.

Activision Blizzard's latest three quarterly reports show that the company's net revenue is $65.438+78 billion, a year-on-year decrease of 65.438+04%; Net profit was $435 million, a year-on-year decrease of 32%. Monthly active users reached 368 million, down 5.6% year-on-year, and it is expected to reach 290 million, showing a significant decline.

According to the financial report, various games released by Blizzard China (World of Warcraft, StarCraft II, Hearthstone Legend, Watch Pioneer, etc. ) accounts for about 3% of the consolidated net income of Activision Blizzard 202 1.

However, 3% of the data is based on the income of $8.803 billion from Activision Blizzard at headquarters, covering businesses such as Activision, Blizzard Entertainment and King. If the net income of Blizzard Entertainment related to Netease agency business is 65.438+0.827 billion US dollars, Netease agency business should account for about 65.438+0.5% of Blizzard Entertainment income.