China is becoming a very important market for Blizzard. It has the largest gaming market in the world, generating USD46.6 billion with more than 700 million gamers. However, it is also very strict, the central government only approves a limited amount of games each year, regardless of local and foreign games.
The Verge reported that due to a disagreement with its licencing and publishing partner NetEase, Blizzard will stop some of its games in China. After 23 January 2023, Chinese gamers won’t be able to play World of Warcraft, Warcraft III: Reforged, Diablo III, Hearthstone, Overwatch 2, Starcraft, and Heroes of the Storm.
Diablo Immortal, the recently released free-to-play mobile title is not part of this agreement and thus can continue as normal. The second season of Overwatch 2 and the most recent World of Warcraft expansion, Dragonflight, among other upcoming releases, “will proceed later this year,” according to Blizzard.
Since 2008, Blizzard has had games published by NetEase, the second-largest gaming company in China, and they have had a 14-year partnership. There was supposed to be a World of Warcraft mobile game, but the 2 companies couldn’t reach a deal about financial and player data.
We are looking for alternatives to bring our games back to players in the future.Blizzard Entertainment, President, Mike Ybarra.
For NetEase, this partnership’s dissolution has minimal effect on them financially. The company said:
The net revenues and net income contribution from these licensed Blizzard games represented low single digits as a percentage of NetEase’s total net revenues and net income in 2021 and in the first nine months of 2022.