While we regularly review various strategies to enhance our global competitiveness, no decisions have been made, and we have nothing to announce at this time.
A nice non-denial denial. Having covered Pearl Abyss quarterly earnings calls for 6 years the statement sounds legitimate. Insider Gaming did try to throw doubt on MTN's report by reminding readers the South Korean outlet previously claimed Pearl Abyss’ Crimson Desert was set to release around 2 November. A date which Pearl Abyss has denied.
On Thursday I speculated Pearl Abyss might want to divest itself of CCP Games to make the South Korean studio more attractive to Chinese game companies like Tencent and NetEase. I decided to dive a little deeper into the theory and asked Copilot for reasons the Chinese companies would like to acquire the South Korean studio.
I think Copilot now considers me a bit of a simpleton. The AI program let me know it’s "possible" (the word was actually italicized) -- but not particularly likely -- that Tencent or NetEase would want to acquire Pearl Abyss outright. Tencent or NetEase might be more interested in cherry-picking assets -- like CCP Games or publishing rights -- rather than buying Pearl Abyss whole.
Further questioning of the AI provided five reasons why Tencent or NetEase would prefer to just purchase CCP Games instead of the entirety of Pearl Abyss.
Focused Acquisition - Tencent and NetEase are known for targeted, strategic acquisitions. CCP Games offers a specific value proposition: EVE Online, its tech stack, and its Western market presence. Pearl Abyss, on the other hand, comes with additional baggage—including Black Desert, Crimson Desert, and other projects that may not align with Tencent or NetEase’s current goals. Buying just CCP allows them to avoid inheriting unrelated assets or liabilities.
I'll admit that the evaluation of Black Desert and Crimson Desert as undesirable baggage while EVE Online is seen as a valuable asset made me smile in real life. Conventional wisdom, or at least the websites I read, has the comparison reversed.
Cost Efficiency - Pearl Abyss reportedly paid $225 million for CCP Games in 2018. If CCP is now underperforming and up for sale, Tencent or NetEase could acquire it at a discount, without paying a premium for Pearl Abyss’s broader portfolio.
Just on a personal note, I got a kick out of Copilot's sourcing for the price of Pearl Abyss' acquisition of CCP: MassivelyOP and The Ancient Gaming Noob. I, of course, linked back to my own post on the subject.
Regulatory Simplicity - Acquiring a Korean-listed company like Pearl Abyss would trigger complex regulatory reviews in South Korea and China. A direct purchase of CCP Games -- an Icelandic studio -- would be simpler and faster, especially given China’s tight scrutiny of outbound investments.
Something Copilot didn't bring up was the geo-political aspects of a major Chinese company getting into Iceland. The more influence the other CCP (Chinese Communist Party) has in Iceland, the better for its ambitions in the Arctic.
Western Market Access - CCP’s studios in Reykjavík, London, and Shanghai offer Tencent or NetEase a ready-made Western development and publishing footprint. That’s a strategic asset as both companies seek to expand globally amid domestic regulatory constraints.
I'm pretty sure this point was directed more toward NetEase as Tencent already has a very sizeable presence in North America and Europe. Still, Copilot made a note that Tencent’s expansion strategy is clear: invest in or acquire studios with strong IP, technical talent, and global reach, especially in regions with fewer regulatory hurdles than China.
Web3 Experimentation (Outside China) - CCP is investing in blockchain gaming with titles like EVE Frontier. While crypto is restricted in China, Tencent and NetEase might see CCP as a sandbox for Web3 experimentation—without exposing their core operations to regulatory risk.
According to Copilot, Chinese companies can engage in crypto activities outside China as long as they obey the following conditions:
- Avoid offering crypto services to Chinese residents, even if operating abroad.
- Comply with foreign regulations, including anti-money laundering (AML) and know-your-customer (KYC) rules.
- Be mindful of geopolitical scrutiny, especially in countries like the U.S., where Chinese tech firms face heightened national security concerns.
Going through the above information, I decided to ask one more question. Which game would intrigue potential buyers of CCP Games more, EVE Online or EVE Frontier? By a wide margin the answer was EVE Online.
Copilot described the original game in the franchise as proven, profitable, and iconic with the following strengths:
- Revenue Anchor: EVE Online generated around $60 million in 2024 (I would say more like $54 million), making it CCP’s primary source of income.
- Loyal Community: It boasts a fiercely dedicated player base and a unique, player-driven economy that few MMOs can match.
- Longevity: With over 20 years of continuous operation, it’s a rare example of a live-service game that’s still thriving.
- Strategic Value: For buyers like Tencent, NetEase, or EA, EVE Online offers a ready-made MMO ecosystem with global reach and monetization potential.
EVE Frontier, on the other hand, is described as high risk with high uncertainty:
- Blockchain Focus: Frontier is CCP’s Web3 experiment, built around blockchain and crypto mechanics. That’s a red flag for many traditional publishers due to regulatory and reputational risks.
- Unproven Market: It hasn’t launched yet and faces skepticism from both gamers and regulators.
- Creative Gamble: While it’s ambitious—described as a “massively moddable multiplayer online spaceship survival horror RPG”—it’s still speculative.
Copilot concluded with the observation that EVE Online is the asset buyers trust, while EVE Frontier is the bet they’d have to believe in. Most acquirers would likely view Frontier as optional—interesting if it works, but not a dealmaker.
A lot of the above conflicts with my hot takes from last Thursday. But since I write for myself I have the opportunity to go back and review if my initial assumptions are correct. While I still don't rule out the possibility of Pearl Abyss selling itself off, the way the process works may wind up vastly different.
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