NetEase

History

Ding Lei founded the company in China in June 1997 with just three employees. It sold e-mail servers to internet access providers before developing its own websites that focused on bilingual e-mail and chat rooms, such as the popular 163 email domain. It introduced China's first free e-mail service, first online community, and first personalized information service. After two funding rounds, the company raised nearly $20 million by the end of 1999.

In 1999, NetEase hosted an online literature contest refereed by Wang Meng, Liu Xinwu, and Mo Yan, which contributed to the early growth of internet literature in China.

On July 1, 2000, the company was floated on the American stock market with an initial public offering on Nasdaq. 4.5 million shares were issued at $15.5 per share. The IPO was underwritten by Merrill. During this time, China had made it difficult for Chinese internet companies to reach the Western market. Western investors also remained hesitant to invest in Chinese tech companies. This caused the IPO to be delayed several months and the stock initially underperformed.

Several top executives left the company in June 2001 when it was discovered its sales data may have been misreported. This took place while NetEase was in the midst of buy-out talks with i-Cable Communications. Takeover talks ended soon after. By 2003, Netease had received investments from Softbank, ING Baring, Goldman Sachs, Techpacific.com, and News Corporation. It had 1.7 million registered users on its email service and generated over four million page views each day. It hired 200 people in Beijing, Guangzhou, and Shanghai.

In August 2005, NetEase announced it would shut down its MP3 service due to the proliferation of pirating. Its blog service was launched in September 2006. In December 2007, the company officially launched its own search engine, Youdao, to replace its partnership with Google since 2000. It went on to develop a series of applications under the brand, including a shopping assistant, Youdao dictionary, and more. NetEase was China's second most popular Google search term that year, behind rival Sina. NetEase's official website address is 163.com. It was attributed to the past when Chinese internet users had to dial "163" to access the Internet, before the availability of broadband.

NetEase Games

In 2001, the company formed NetEase Games to focus on gaming. In December, the company launched its proprietary MMORPG Westward Journey Online . It reached 22 million users, with an average of over 400,000 concurrent players, by 2006. In 2008, it started a partnership with Blizzard Entertainment to publish the studio's games in China.

In 2013, the company licensed Hearthstone, Blizzard's free-to-play online strategy card game. In an effort to bring its games to English speaking audiences, NetEase opened its first U.S. office, in the San Francisco Bay Area, in February 2015. In March, a mobile version of Fantasy Westward Journey was released. Within two hours, it reached the number one spot on the top free games chart. The game hit 60 million registered users, with a concurrent user peak of over two million in the first year. It also licensed Cookie Jam and F1 Race Stars. In May, NetEase announced an investment in Helsinki-based developer Reforged Studios. In June, the company also announced a licensing agreement with Blizzard to publish the video game Overwatch.

By 2016, the company had a portfolio of more than 90 mobile games, with 41 more in development. In May 2016, NetEase announced a new partnership with Microsoft and Mojang Studios to bring Minecraft to Asia. Free to play versions for PC, iOS, and Android launched in August, September, and October of the following year. In October 2017, the game had nearly 30 million players. By May 2018, NetEase had over 100 million users.

The company partnered with Mattel in January 2018 to launch a new game developer named Mattel163. It invested US$100 million in Bungie for a minority stake in the company and a seat on the board of directors in June 2018. NetEase took over publishing duties of EVE Online in China, starting in August 2018. That November, Blizzard announced Diablo Immortal, a mobile RPG that would be co-developed by NetEase. The game was later also confirmed for PC and released in June 2022. It did not release in China until the following month.

Former Capcom employee Ryosuke Yoshida opened Ouka Studios in June 2020. In August, NetEase teamed with CCP Games to release EVE Echoes, a mobile version of EVE Online. NetEase, The Pokémon Company, and Game Freak, made an expanded version of Pokémon Quest called Pokémon Adventure, released in China on 13 May 2021. It contains regular updates and events unlike other versions. It invested in Japanese developer Grounding Inc. in September 2021. NetEase acquired Grasshopper Manufacture from GungHo Online Entertainment in October 2021. When indie publisher Devolver Digital went public on the London Stock Exchange in November 2021, NetEase purchased an 8% stake in the company. Toshihiro Nagoshi, Daisuke Sato, and several former Sega employees established Nagoshi Studio in January 2022.

Music streaming

In April 2013, NetEase launched a music streaming service called NetEase Cloud Music. In 2017, it received enough funding to be valued at over $1 billion, receiving unicorn status. In December 2017, NetEase signed a licensing agreement with Kobalt Music Group, gaining access to over 600,000 songs in its catalog.

While rival Tencent held licensing deals with the big three record labels, NetEase focused on independent artists. By 2018, over 70,000 independent artists had uploaded over 1.2 million songs to the platform. In November 2018, NetEase signed a non-exclusive partnership with indie label Merlin Network. in September 2019, Alibaba announced it had invested $700 million to gain a minority stake in NetEase Cloud Music. The service surpassed 800 million registered users by the end of 2019 a 200 million increase from the year before.

In 2020, NetEase entered into licensing agreements with Warner Chappell Music and Universal Music Group, giving users access to the publishers' catalog. In May 2021, NetEase entered into a direct digital distribution relationship with Sony Music Entertainment. NetEase spun off its music streaming business as a separate company in August, listing it on the Hong Kong Stock Exchange.

NetEase Comics

In 2015, the company launched NetEase Comics to focus on the comic book business. In 2017, NetEase signed a collaboration deal with Marvel Comics to publish comics in China and create Chinese superheroes, including Swordmaster and Aero. By 2018, its online platform had published more than 2,000 comic book series and 40 million registered users. However, at the end of the year, NetEase sold its comics business to Bilibili while retaining the copyright to its Marvel series.

Chinese government regulation

In October 2020, the Cyberspace Administration of China ordered NetEase to undergo "rectification" and temporarily suspend certain comment functions, after censors found inappropriate comments on the news app.

Game studios under NetEase

Games developed and published by NetEase Games

Licensed online games

Three-year agreement to license Overwatch in PRC

Agreement to license Minecraft and the pocket edition in China

Operated the Chinese third-party Minecraft Hypixel server, which was shut down on 30 June 2020

Assumed the publishing of Eve Online in the Chinese market in October 2018

Game technology

NetEase develops two in-house game engines for some video games: Messiah Engine and NeoX.

Pig farming

In 2009, NetEase founder Ding Lei announced his intention to modernize pig farming in China. The company's agricultural affiliate Weiyang set up a pig farm in Anji county, Huzhou, Zhejiang province in 2011. The state of the art facility included tracking sensors, data analysis, soothing music, artificial intelligence, and Wi-Fi. The public could also track the pigs online.

In November 2016, the company held an online auction that sold three of its Jeju Black pigs for a total of $75,000. Since the meat has gone to market, NetEase has sold it on the company's Yanxuan e-commerce platform. Meituan Dianping, Sinovation Ventures, and JD.com invested in the endeavor in 2017. By 2018, the facility was overseeing the rearing and slaughter of 20,000 organic free-range hogs each year.

In October 2017, the company announced that it had established a second farm in Gao'an, Jiangxi. NetEase announced in September 2019 that it would invest 1.5 billion yuan ($211 million) to build a pig farm in Shaoxing.