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Media & Entertainment

NetEase rejects proposal to extend tie-up: Activision Blizzard

Chinese publisher for U.S. video game developer set to end service on Jan. 23

U.S. game developer Activision Blizzard said on Nov. 17 that China's NetEase rejected an offer to extend its partnership with NetEase for six months.    © Reuters

HONG KONG (Reuters) -- Activision Blizzard, the U.S. video game developer behind hit franchise Warcraft, on Tuesday said its Chinese publisher NetEase had turned down a proposal to extend their longtime partnership for six months.

In a statement on microblogging site Weibo, the U.S. company's subsidiary Blizzard China said it contacted NetEase last week with a proposal to extend their partnership and that the Hangzhou-based company had declined.

Blizzard China said its game services will end on Jan. 23.

NetEase did not immediately respond to a Reuters request for comment.

The development comes after Activision Blizzard in November said it would end its 14-year partnership with NetEase, the second-largest gaming company in China. The announcement sent shock waves across the industry as the partnership was widely seen one of the most lucrative in video games.

NetEase, in a November earnings briefing, said it had made the utmost effort to negotiate but found the proposed terms requested by the U.S. company unacceptable.

NetEase then said it would have to discontinue Activision Blizzard's game service in China, the world's biggest gaming market, on Jan. 23.

With the demise of their partnership, Activision Blizzard was left without a Chinese publisher and said in December it was in talks with potential partners.

NetEase rose to become a gaming giant partly by publishing Activision Blizzard's games in China. The company has since accelerated its own game development capability, with in-house games now accounting for over 60% of revenue.

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