Chinese companies Tencent and NetEase are reportedly scaling back their investments in Japanese video game studios due to the lack of big hits, including shutting down Visions of Mana developer Ouka Studio.
According to Bloomberg, NetEase has already let go of developers from Ouka Studio, a process that started this spring. NetEase reportedly has only a few people left over at Ouka Studios to oversee the launch of its final games before its closure.
Additionally, Tencent acquired the rights to publish the mobile version of Bandai Namco’s Blue Protocol. However, Bandai Namco announced earlier this week that it was ending support for the game in 2025, along with the cancelation of its international release via Amazon Games.
There reportedly have been misaligned goals between Tencent and Japanese game developers. Local Japanese developers want to create smaller-scale and lower-risk projects, while Tencent wants globally successful franchises. As such, Tencent has reportedly set higher expectations when it comes to funding these developers.
A few examples of NetEase’s investment in Japanese studios include Nagoshi Studio, led by Yakuza creator Toshihiro Nagoshi, as well as its acquisition of Grasshopper Manufacture, the studio behind No More Heroes. Tencent also has a 5% minority stake in GameScience, which recently released the massively successful Black Myth: Wukong.
