NetEase's Marvel Rivals has proven to be a smashing success, attracting an impressive ten million players in just three days after its launch and generating substantial revenue for the developer in the subsequent weeks. However, a recent report from Bloomberg sheds light on the precarious journey this game took to reach its current acclaim, revealing that NetEase CEO and founder William Ding nearly pulled the plug on the project due to his reservations about using licensed IP.

The Bloomberg report outlines a broader strategy at NetEase, where Ding is aggressively streamlining operations. This includes cutting jobs, shutting down studios, and pulling back from international investments. The aim, as per the report, is to create a more focused portfolio that can better withstand the recent dip in growth and stand up against competitors like Tencent and MiHoYo.

Part of this strategic overhaul reportedly involved a near-cancellation of Marvel Rivals. Sources indicate that Ding was hesitant to pay for the Marvel license and attempted to push for the use of original characters instead. The attempted cancellation reportedly cost NetEase millions, but the game ultimately saw the light of day and has since enjoyed significant success.

Despite Marvel Rivals's success, NetEase continues to downsize. Just this week, the Seattle team working on Marvel Rivals was laid off, a move the company attributed to "organizational reasons." Over the past year, Ding has also halted investments in overseas ventures, withdrawing from significant stakes in studios like Bungie, Devolver Digital, and Blizzard Entertainment. The report suggests Ding's focus is now on games that can generate hundreds of millions annually, although a NetEase spokesperson clarified to Bloomberg that the company does not set arbitrary financial thresholds for new game viability.

Internally, NetEase is facing its own set of challenges, with employees describing Ding's leadership style as volatile. According to Bloomberg, Ding is known for making swift decisions and frequently changing his mind, putting pressure on staff to work long hours, and bringing in recent graduates into high-level leadership positions. The report also warns that NetEase might not release any new games in China next year due to the number of projects Ding has canceled.

NetEase's retreat from game investments coincides with a period of uncertainty in the global gaming industry, particularly in Western markets. Recent years have witnessed widespread layoffs, project cancellations, and studio closures, alongside high-profile game flops that have not met the lofty expectations set by their developers.