Chinese publishers such as NetEase might be abandoning Japanese developers after years of investment 

According to Bloomberg, major Chinese publishers such as Tencent and NetEase are rethinking their investments in Japanese game development studios. This appears to be due to the initiatives yielding fewer hit titles than expected, as well as the recent boom in China’s domestic scene, with hits such as Black Myth Wukong breaking all past records. 

In 2020, NetEase Games founded the Tokyo-based studio Ouka, which is notably the developer of Square Enix’s Visions of Mana (released on August 29). The studio employs Chinese developers as well as veterans from big Japanese companies like Square Enix and Capcom. However, according to insider information, it seems that the company has cut most jobs at the studio and intends to close it, but this has yet to be officially confirmed by NetEase. 

For reference, NetEase also funds Japanese developers such as Nagoshi Studios, led by the founder of SEGA’s Yakuza series, as well as Goichi Suda’s Grasshopper Manufacture. 

At the same time, Tencent also seems to be considering backing out or lowering the scale of its investments in Japan. Insiders say the Chinese giant has already backtracked on funding several new games, and one of its bigger initiatives – the publishing of Bandai Namco Online’s Blue Protocol, recently fell through with the announcement of the MMORPG’s premature end of service.