Activision loses money, Blizzard to release one marquee game per year
by Mike Schramm 
Feb 12th 2009 at 1:00PM
Activision-Blizzard held a conference call for the press yesterday, and so there's all kinds of financial and release news floating around out there. The biggest news isn't necessarily Blizzard-related, but it does mean that our game's company is finally feeling the crunch a bit: Activision-Blizzard reported a loss of $72 million in the last quarter, and their outlook for the coming year fell short of analysts' expectations. Even though that sounds bad, it doesn't mean things are necessarily bad, though: Blizzard themselves added nearly a billion dollars to the total, so while A-B might not be doing so well, B is doing just fine.Blizzard CEO Paul Sams also announced during the call that the company is now aiming for "one 'frontline' title per year," though not necessarily World of Warcraft related. That likely means that we'll see the first Starcraft 2 this year -- our friends at Joystiq have a quick report on the beta appearing soon, as well as the Battle.net revamp we've been waiting for. And it also means that (unless Blizzard is really rolling on Diablo III, which I doubt, given its condition when we played it at last year's BlizzCon), that we'll be looking at mid/late 2010 for the release of the next WoW expansion.
Besides the loss of the $72 million (it's always in the last place you look), things seem to be hopping at Blizzard and their parent company. Should be a pretty busy 2009 for them.
Filed under: Analysis / Opinion, Odds and ends, Blizzard, Expansions, Making money, Wrath of the Lich King
Reader Comments (Page 1 of 3)
David Feb 12th 2009 1:06PM
Oh good, so we get to go from Blizzard releasing games when they're polished to releasing games when Activision needs money. This can only end well.
Robert M Feb 12th 2009 1:30PM
Doesn't it make the picture of the mana (money) junkie BE commanding the pet for more rather appropriate?
AyaJulia Feb 12th 2009 1:05PM
I have a hard time understanding how anyone could pair with a company as successful as Blizzard and still lose money. :s That's a pretty heavy dose of failure.
Regardless, I hope that's a promise of at least one game a year and not a limitation of no more than one game a year. <3 Blizz.
Liel Feb 12th 2009 3:53PM
I could see it, Activision paired up with a company that many articles have said has hurt game sales. MMO's take up more time to play, I know for myself in the last four years my game purchases have taken a dramatic downturn compared to before I started wow.
Lemons Feb 12th 2009 3:55PM
I agree that Activision fails, but honestly, we're in an economic downturn, I don't find it difficult to image any company losing money with the current state of the economy.
AyaJulia Feb 12th 2009 4:09PM
@Liel: Still, you're not going to specifically stop buying Activision games because they partnered with Blizz. I'll agree in a heartbeat that people who play MMOs buy far fewer games, but that would've impacted Activistion whether they were with teamed with Blizz or in competition with Blizz. Activision had to have been on the brink of going out of business if they suffered such an immense loss with such a huge guaranteed monthly paycheck. :)
Faar Feb 12th 2009 8:17PM
How anyone could lose money with Blizzard pulling in 900+ million in pure profit is one thing, why Blizzard would pair up with anyone else - and especially such a loser company - when they're making that kind of dough is another.
Well, it wasn't really up to them as they were owned by Vivendi at the time, but still. Why trade down to be owned by Activision and that greedy moneygrubbing shitbag Kotick? Every time I see a picture of his flabby grinning mug I want to punch his teeth out.
The deal never made one iota of sense to me. Where was Blizzard/Vivendi's advantage here? There isn't one! Selling off Blizzard is like selling a hundred bucks for ten... You'd be an idiot to do it, owning Blizzard is practically free money in the bank. You don't cook the goose that lays golden eggs!
Netherscourge Feb 12th 2009 1:05PM
Sounds like they want to go down the Electronic Arts route - pump out half-assed titles once or twice a year to keep the money flowing.
Bad news if you ask me.
Tythian Feb 12th 2009 1:45PM
Exactly what I was thinking...
"Oh great, 1 title per year... if it is ready or not!"
They'll just patch their garbage up as they go along and make it sound like they are working hard at producing quality material... instead their are pumping out titles and releasing them even in a half assed state.
I guess watching Age of Conana and Warhammer Online tank didn't teach them anything
Ilnara Feb 12th 2009 5:57PM
I'd cite this is the reason that Activision has lost $72M.
Half-assing their titles to release then 'dealing with it' after the fact,
costing extra overhead, staffing, and resources to correct. Then, after a year, dropping them like hot potatoes for the next pile of garbage - rinse repeat.
paul.marsico Feb 12th 2009 1:09PM
Considering how badly implemented 3.0.8 was, the gear merge of 3.0, and the bad logic that has permeated PVP (1000 resilience or GTFO) this does not bode well. They should take the resources, buy back their stake from Activision and go out on their own and focus on making WoW as good as it can be.
KotOR looms large on the horizon and I personally know a lot of people looking for anything that isn't being dumbed down or simplified like WoW is.......
Marc Sadowski Feb 12th 2009 1:17PM
What happens in the game does not necessarily mean that the stock will go down.
The ONLY way players can change a blizzard stock is if they cancel their accounts. Stopping the money flow will directly effect the company stock. Do you really think stock analysts care what they hell happens in the game? Nope. They don't know or care. All they see is the success of the games sold and subscription rates.
Only when you see the subscription rate level or go down, you will see REAL panic in the stock.
Right now, it's just a bad economy. Plain and simple.
Netherscourge Feb 12th 2009 1:09PM
Well, when Sunwell or Black Temple-sized patches start turning into paid expansion packs, you know Blizzard has jumped off the cliff.
It's only a matter of time...
Robert M Feb 12th 2009 1:44PM
For only 39.99 you too can visit Illidan in the fabulous Black Temple Resort.
But wait, that's not all, for an additinal 39.99 we will throw in a 1 week stay at the luxurious Sunwell Plateau, for you and 24 of your closest friends.
Call now, 1-800-activision
/in muttered tone
To insure that you enjoy your stay at Sunwell, we highly suggest you befriend several shaman. Blizzard is not responsible for destroyed relationships that result from this wonderful offer.
Marc Sadowski Feb 12th 2009 1:12PM
It's not that the company is doing bad. It's all the stocks going down. The industry as a whole is doing bad because ALL the industries are doing bad. Everyone is feeling the crunch, and all they're trying to do is keep the losses from getting worse.
If you guys REALLY want to tract Activision Blizzard stocks, use something simple like http://www.MarketBrowser.com That's what I use because it's free and it gives you a good idea of what's happening with the company stock-wise.
http://www.nanago.com
Brian Feb 12th 2009 1:15PM
If Activision would work on games for 3 years instead of throwing out sequels once or twice a year they might make a little more money. Call of Duty 4 is still fun to play after a year but (World at War) is already out which splits the player base. Guitar World Tour has a far superior drumset to Rock Band but the color scheme and vocal text font make the game difficult to play. They rushed it so they could claim that Rock Band 2 was a ripoff of their game (which is very illogical). If they release higher quality games, money won't be a problem.
Todd Feb 12th 2009 1:15PM
Activision is just pissed that game sales are down, because of the economic downturn. I suppose they have to include Blizzard in these calls, but honestly, just let Blizzard do what they want and how they want it. They've been highly successful without YOU and can still be highly successful without YOU.
Orthrus Feb 12th 2009 1:16PM
that's weird. I was just reading about how well they were doing just recently on Kotaku: http://kotaku.com/5151500/activision-blizzard-shrugs-off-recession-reports-5-billion-in-revenue
zappo Feb 12th 2009 1:29PM
Devil is in the details as far as I can tell. The company didn't just lose a bunch of money, basically all that happened was that their stock price went down. Which isn't all that surprising considering this is the worst recession since the great depression and the entire market is down. Earnings and growth of the company are actually still up from everything I've heard.
Tib Feb 12th 2009 1:19PM
Didn't Blizzard say they wanted to release an expansion once a year? As good as WotLK has been there is not enough in it to keep me playing for another 18+ months, even with a couple of extra raids.