NetEase to withdraw investments, putting foreign game studios at risk

With the Marvel Rivals, a hero shooter, NetEase has become a major gamechanger in the esports industry. The game has been doing exceptionally well and there are no signs of the company slowing down its pace.Despite generating widespread profits in the gaming sector, the scenario behind the scenes seems totally different. NetEase has been planning to pull out their investments from most of the foreign studios. 

A report from the Game File suggests that NetEase has been exploring the sale of several non-Chinese studios and are making efforts to offload them. In case they fail to find buyers, NetEase will likely take away their funding from these studios, which will result in the closing of multiple game studios. 

When asked about this development, NetEase refused to comment andsaid, “all studios and projects are in constant review and evaluation, and NetEase will determine changes needed to be made throughout that process.”

Nagoshi and Grasshopper to receive a major blow

The sad reality is that NetEase has some of the most talented people in the industry, like Quantic Dream who were the creators of Detroit: Becomes Human and Heavy Rain. Star Wars: Eclipse is yet to be developed. The company also has a hold on GrassHopper Manufactures. The company also holds a few stakes in Rebel Wolves and Nagoshi Studios.

The impact on the studios will mostly differ from one another. Studios like Nagoshi and Grasshopper might be directly affected by this move by NetEase. Since these studios develop games focusing mostly on a niche genre, they will be forced to look for funding from other companies. 

The developers of the industry will be highly affected by this move from NetEase. This move can also be traced back to the mass lay-offs by the company in the recent past. It will be saddening to see the developers’ efforts go in vain, if not acquired by other gaming companies.