NetEase Founder Nearly Cancels Marvel Rivals Over IP Concerns

NetEase's Marvel Rivals has been a resounding success, amassing ten million players in just three days post-launch and generating significant revenue for the developer in the subsequent weeks. However, a recent Bloomberg report reveals that NetEase CEO and founder William Ding was on the verge of canceling the game due to his hesitance to utilize licensed intellectual property (IP).

According to Bloomberg, Ding is currently streamlining NetEase's operations by cutting jobs, closing studios, and halting overseas investments. The aim is to create a more focused portfolio to address recent growth declines and to better compete with industry giants like Tencent and MiHoYo. Part of this restructuring effort reportedly included a near-cancellation of Marvel Rivals. Sources indicate that Ding was reluctant to pay for the use of Marvel characters and attempted to convince artists to use original designs instead. The attempted cancellation is said to have cost NetEase millions, yet the game was ultimately released to its current acclaim.

Despite the game's success, NetEase's restructuring continues. Earlier this week, the Marvel Rivals Seattle team was laid off due to what the company described as "organizational reasons." Over the past year, Ding has stopped investing in overseas projects, reversing earlier heavy investments in studios such as Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests that Ding views games not capable of generating hundreds of millions annually as not worth pursuing, though a NetEase spokesperson clarified to Bloomberg that the company does not set "arbitrary blanket numbers" for new game viability.

Employees speaking to Bloomberg have highlighted internal challenges at NetEase, attributing them to Ding's unpredictable leadership style. They describe Ding as making swift decisions and frequently changing his mind, pressuring staff to work late, and recently appointing numerous recent graduates to leadership positions. It's also alleged that Ding has canceled so many projects that NetEase might not release any games in China next year.

NetEase's retreat from game investments coincides with a period of uncertainty in the gaming industry, particularly in Western markets. The industry has faced consecutive years of widespread layoffs, project cancellations, and studio closures, compounded by the underperformance of several high-cost, high-profile games.