NetEase's Marvel Rivals, a resounding success with ten million players in its first three days and millions in revenue for NetEase, almost never saw the light of day. A new Bloomberg report reveals that CEO William Ding nearly canceled the game due to reservations about using licensed IP.

This near-cancellation is part of a larger restructuring at NetEase, characterized by job cuts, studio closures, and a retreat from overseas investments. Ding aims to streamline the company's portfolio to counter recent growth stagnation and better compete with industry giants Tencent and MiHoYo.

The report alleges that Ding's reluctance to pay licensing fees for Marvel characters led him to push for original character designs, a decision that reportedly cost NetEase millions before the game's eventual release. Despite the game's success, the restructuring continues. The recent layoff of the Marvel Rivals Seattle team, attributed to "organizational reasons," exemplifies this trend. Over the past year, NetEase has also ceased investment in overseas projects, reversing previous significant investments in studios like Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests a focus on games projected to generate hundreds of millions annually, although NetEase denies using arbitrary revenue targets for game viability.

Internal sources paint a picture of instability under Ding's leadership, citing his volatile decision-making, pressure on employees to work excessive hours, and the appointment of recent graduates to senior leadership positions. The frequency of project cancellations is so high that NetEase may not release any new games in China next year.

NetEase's shift in investment strategy reflects the broader uncertainty within the global games industry, particularly in Western markets. Recent years have been marked by widespread layoffs, cancellations, and studio closures, alongside numerous high-profile game failures despite significant investment.