China’s NetEase condemns Blizzard as unjust and unequal

HONG KONG (AP) — China games company NetEase Inc. has rejected a proposal from World of Warcraft creator Activision Blizzard to temporarily extend its partnership while the U.S. company seeks a new partner, calling the proposed terms “unequal and unfair” in an escalating public spat.

Blizzard said in November that its 14-year partnership with NetEase was set to end, spelling the imminent withdrawal of games such as World of Warcraft, the Starcraft series, and Overwatch from the world’s biggest games market as of Jan. 23.

NetEase released a statement Wednesday saying that Blizzard offered to extend the partnership for six month under existing terms and it was still looking for a partner in China.

“We believe that Blizzard’s proposal … is rude, inappropriate, and not in line with business logic,” NetEase said.

The Chinese company criticized Blizzard for its “excessive confidence” in making requests that it said demonstrated a lack of consideration for NetEase and gamers.

NetEase’s statement came a day after Blizzard said the Chinese firm had declined to take up an extension offer that would have prevented a disruption of services in the Chinese market while the U.S. firm continued to negotiate with potential partners.

Blizzard has not yet found a Chinese publisher for its games, as this is required to release its titles in China. It promised to launch a service that would allow users to save their World of Warcraft progress and then download it so that they can resume playing the game when it comes back online.

In part due to NetEase’s longstanding partnership with Blizzard, the Chinese company has grown to become China’s second-largest games distributor after local rival Tencent.

NetEase’s shares plunged following the November announcement the partnership was ending. They recovered after the company said Blizzard’s games contributed only a low single-digit percentage of its total revenue and income.

NetEase CEO William Ding said at the time that there were “material differences on key terms” that the two companies could not agree on.