As the Chinese technology giant continues its aggressive foreign growth drive, NetEase revealed on Wednesday that it had acquired a French game developer.
With the acquisition of Quantic Dream, the company with headquarters in Hangzhou, China, established its first wholly owned game studio in Europe.
As the Chinese domestic gaming business slows down due to stricter regulations, NetEase and its rival Tencent have increased their efforts abroad.
Tencent has a history of making several investments and acquisitions of foreign gaming firms. Today, NetEase is catching up.
The establishment of game studios by NetEase in the US and Japan has only occurred this year.
In the past, NetEase has mostly concentrated on PC and mobile gaming, two platforms that are hugely popular in China. More than half of its global game revenues come from mobile gaming. The tech juggernaut has begun dipping its toes into console gaming, meanwhile, more recently.
The 25-year-old studio Quantic Dream will concentrate “on creating and publishing its video games on all platforms, as well as supporting and publishing third-party developed titles,” aon the basis of a press release.
That demonstrates NetEase’s desire to expand across mobile, PC, and console platforms.
The purchase of Quantic Dream is consistent with NetEase’s acquisition strategy of well-known international franchises and personalities. A video game called Star Wars Eclipse is currently being created by Quantic Dream and is based on the space adventure films from Disney. Mobile games based on Harry Potter and The Lord of the Rings have previously been made available by NetEase.
While Chinese officials continue to closely monitor the games business, there are signs that they may be letting up a bit, which is why NetEase is making an overseas push. Authorities imposed time limits on people under the age of 18 who played online games last year and put a freeze on the approval of new games. For games to be published and made commercially viable in China, authorities must give their approval. In April, they once again began to approve.
Hu Zhipeng, vice president at NetEase and one of the senior managers of the internet giant’s video games division, stated in an interview with CNBC last year that he hopes to increase the percentage of the company’s gaming revenue from approximately 10% to 50% in the future.
The global gaming market is becoming more competitive.
Sony, a pioneer in console gaming and the company behind the PlayStation, made the announcement on Tuesday that it is establishing a separate mobile subsidiary, putting it in direct rivalry with Chinese juggernauts Tencent and NetEase.