Lending further credence to reports from earlier this year about NetEase scaling back its Non-Chinese gaming investments, the company has announced that it is shutting down one of its western studios. According to Game Developer, NetEase has shut down T-Minus Zero Entertainment. The announcement came shortly after studio head Rich Vogel posted that its partnership with NetEase was coming to an end.
“We deeply appreciate NetEase for providing us with both ample runway and support – from helping us find potential investors to giving us the time and budget to develop our game into a fully playable hands-on demo,” wrote Vogel on LinkedIn. “It has generated a lot of interest. However, despite this progress, current market conditions have prevented us from securing the funding we need at this time.”
Shortly after Vogel’s post, NetEase further confirmed the closure of the studio with a statement to Game Developer, noting that the decision was made because the company had to reassess its business priorities.
“This decision was made with careful consideration, as we have been inspired by our partnership with the studio and their bold vision,” NetEase said in its statement. “However, we have had to reassess our business priorities and are now working closely with the studio to provide support and explore next steps.”
T-Minus Zero Entertainment was originally founded back in 2023. Headed up by former BioWare developer Rich Vogel, the studio was based out of Austin, Texas, and was working on a new multiplayer action game set in a brand new sci-fi universe. The studio was comprised of industry veterans alongside Vogel, including Mark Tucker, Jeff Dobson and Scott Malone.
“Our studio’s mission is to create epic, immersive worlds where players from around the globe can play together, forming vibrant and passionate communities,” Vogel said when the studio’s founding was announced.
While NetEase itself hasn’t made any major announcements about its scaling back of overseas gaming investments, reports had come up back in February about NetEase CEO William Ding losing confidence in its overseas studios. According to founder of VC firm F4 Fund, David Kaye, a number of things have led to this move from NetEase, including geopolitical tensions and “the whims of certain CEOs.”
“China is in retreat: geopolitical tensions, some big bets not paying off, and the whims of certain CEOs mean that a massive pullback has begun,” said Kaye. “One MAJOR strategic that has made dozens of investments in the past several years is reportedly pulling the plug and divesting ALL investments outside China. Some will likely find buyers. Others will not be so lucky.”
According to the report, NetEase noted that it wasn’t pulling out of all of its overseas investments in one go, since that would have wide-reaching affects beyond just the company’s own titles like Marvel Rivals.
“As far as overseas business efforts are concerned, NetEase has not wavered in its global expansion plans,” said NetEase in a statement. “Our ‘two-pronged’ approach, proposed in 2022 (combining self-research and investments to explore overseas markets), is still actively progressing and yielding positive results.”
