The following is my latest post on Digital East Asia.
Phoenix TV and various other Chinese media, as well as lots of Internet forums, are picking up on rumors that the long-awaited World of Warcraft (W0W) expansion Wrath of the Lich King (WLK) is close to release.
The rumor is interesting considering the issues that NetEase.com, Inc.((ADR) NASDAQ: NTES) has had surrounding the operations of the massively multiplayer online game in China. The fact that it’s caught between an apparent power struggle between General Administration of Press and Publication (GAPP) and Ministry of Culture (MoC) has made the future of the game extremely unclear. Indeed, an article on People.com.cn (the state owned paper) claims that many retailers of point cards are not selling WoW cards and waiting for the situation to clear, which means that even if fans wanted to play (and pay), they are currently having a hard time getting access. In addition, Netease has put a hold (from official Chinese WoW website, link in Chinese) on registering new characters in certain servers. This could be purely due to technical reasons, but one could also speculate that it’s due to uncertainty regarding the game.
While it’s probably not good practice to over-analyze Internet forum rumors, Phoenix TV is generally a well-respected source. According to their article, “informed sources” claim that Netease CEO William Ding has resolved the company entity issue regarding the JV between Netease and Activision Blizzard Inc. (NASDAQ: ATVI) which operates WoW in China. According to Chinese regulations, foreign companies are not allowed to operate online games in China; sources claim that William Ding and the Netease team has purchased shares of the JV to overcome the regulatory hurdle.
At the same time, Netease and Blizzard has finished most changes to the WLK game content as required by Chinese regulators (including major changes to the “Death Knight” character). Phoenix TV’s sources claim that WLK could be online for testing in as soon as 2 weeks, while other publications have pointed out that the game still needs to go through the approval process by the MoC, which could last as long as 60 days.
Regardless, it seems that William Ding has the support of the MoC. Now the question is how GAPP will respond to these new rumors, especially if any of them materializes.