Blizzard's Failure in Hong Kong, Or: Why US Corporations Value China More Than The US.
Updated: Jan 26, 2020
If you book a flight to Beijing using American Airlines, your destination looks like this: "BJS - Beijing, China."
Book a flight to Taipei, on the other hand, and you get this: "TPE - Taipei International."
Notice anything? American Airlines - along with Delta and United - were pressured by China to remove any mention of Taiwan back in 2018. China has historically refused to acknowledge Taiwan as a sovereign nation. The reasoning is simple - doing so would force China to recognize that Taiwan successfully split from China.
China's relationship with Taiwan is relevant not only to our story today but also plays a role in how China deals with Hong Kong on the stage of international politics. Despite Hong Kong's status as a sort of autonomous city-state in China under the "one country, two systems" rule, China has shown a vested interest in absorbing Hong-Kong into the Chinese mainland. For many residents of Hong Kong, the idea of having to abide by the systems of mainland China is terrifying.
Let's fast-forward a bit.
In June 2019, a bill was proposed in Hong Kong that would allow the extradition of individuals such as criminals sentenced in Hong Kong to mainland China. Backlash was swift, and protests kicked off. Hong Kong officials withdrew the bill in September, but the focus of the demonstrations had shifted. The protestors now had four additional demands:
For Hong Kong officials to stop classifying the protests as 'riots'
Amnesty for arrested protesters
A non-partisan investigation of police brutality
Complete suffrage for Hong Kong residents
Fast forward to October. During a post-match live stream, HearthStone eSports player Blitzchung showed support for protesters in Hong Kong, wearing a gas mask and ski goggles, he yelled "Liberate Hong Kong. Revolution of our age!"
Cut to commercial.
Blizzard - the company that makes HearthStone - was quick to act. Blizzard suspended Blitzchung for a year and revoked his tournament winnings. The company also promptly fired the interviewers who appeared on the live stream with Blitzchung.
Immediately, the HearthStone community - and the videogame community at large - decried Blizzard's actions. As a result, awareness of Blitzchung's ban spread to the mainstream.
Within two weeks of the event, US congress-members penned a letter to Blizzard asking CEO Robert Kotick whether he would "decide whether to look beyond the bottom line and promote American values...or to give in to Beijing's demands to preserve market access." The public at large had crucified the decision, making it a monumental PR failure for Blizzard. Incensed Blizzard employees covered up a plaque reading "every voice matters" in front of the company's headquarters in Irvine, California.
To say Blizzard was able to put out the fire would be an overstatement.
Blitzchung's ban was reduced to six months, and his winnings were reinstated. However, Blizzard's goodwill was undermined by a statement made on Weibo (the Chinese equivalent of Twitter) by NetEase - Blizzard's communication partner for China - that denounced Blitzchung's actions. Here's a standout tidbit from that statement:
"We will, as always, be determined to defend the pride of the country (China)."
On November 1st, protesters in anti-Blizzard attire appeared en masse outside the convention center where BlizzCon, a yearly event where Blizzard announces new games, was held. At BlizzCon, Blizzard President J. Allen Brack had this to say about the "tough HearthStone eSports moment" (his words) the company faced:
"We moved too quickly in our decision, and then, to make matters worse, we were too slow to talk with all of you. We didn't live up to the high standards we set for ourselves. We failed in our purpose.
I am sorry, and I accept accountability. What exactly is our purpose? BlizzCon is demonstrating it as we speak. We aspire to bring the world together in epic entertainment. I truly believe in the positive power of video games."
Blizzard's failure to specify actions they would take to rectify the situation with Blitzchung (and indeed, their refusal to mention Blitzchung by name at all) made the statement ring as a hollow non-apology engineered to engender goodwill without explicitly admitting fault.
Blitzchung is still banned. Blizzard, despite the non-apology Allen issued, is still clearly toeing the line of public perception to maintain China's goodwill.
Nobody should be surprised.
There has been widespread confusion over Blizzard's adamant defense of China. China only accounted for 5.2% of Blizzard's revenue in 2018, and the company's PR has suffered dramatically in the last month.
But that 5.2% is double what Blizzard earned from China in 2017. With Diablo: Immortal, a mobile ARPG aimed at the Asian market on its way, it's no surprise that Blizzard has buckled down on their defense of China.
For Blizzard, this PR blunder is temporary. The company knows that when new games are announced or enough time passes, people will eventually move on.
They're right. Blizzard announced Diablo 4 and Overwatch 2 at BlizzCon and immediately received positive press - from fans and critics alike - for doing so.
Blizzard's investment in China is not quite so transient. The company has realized that whatever PR damage they take in the US will be a worthy trade-off for the revenue they receive from China in the coming years.
Are they wrong?
In recent years, corporate 'wokeness' - in which brands showcase their support for socially progressive movements - is trending.
But they don't mean it.
For companies, supporting LGBTQ+ communities may result in a sales spike during pride month. But that doesn't mean most corporations with rainbow-colored logos will stop doing business in countries such as Saudi Arabia that openly persecute people for their sexuality.
Here's the bottom line: for most corporations, profits matter more than morals ever could.
Just ask Blizzard. Or American Airlines. Or Delta Airlines. Or United. Etc. Etc.