Posts with tag bobby-kotick

Anyone who's paid attention to the roller-coaster that is Activision's relationship with its former owner Vivendi, here's a new wrinkle for you. Activision CEO and perennial villain in a million fans' hearts Bobby Kotick was nearly let go by Vivendi in 2013 over his refusing to sign off on any deal that excluded his own private investment group.

According to the lawsuit filed in Delaware, this allowed Kotick, Brian Kelly (Activision's Chairman) and their investment partners (including Tencent Holdings Ltd.) to gain a 25% stake in the company at the same rate that Activision itself paid for the remainder. This is claimed to have allowed them to get away with not paying a premium for control over the company. The lawsuit alleges that this is an improper benefit to Kotick, Kelly and their group.

What's really fascinating is that Kotick's stand on this issue, going so far as to threaten to resign in 2013, seems to have been seriously considered by parent company Vivendi. Former Vivendi CEO Jean-Francois Dubos and then-CFO Phillipe Capron were among those speculating on firing Kotick, with Capron going so far as to volunteer to do it the very next day after the email exchange in May of 2013. Considering he was one of the highest paid CEO's of any game company, I'm surprised they chose to back down -- perhaps his contract made firing him punishingly expensive. In the end, Vivendi blinked first and Kotick and his group got to make exactly the deal that they're getting sued over now.

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Activision Blizzard head honcho Bobby Kotick was one of the highest-paid CEOs in America last year, Bloomberg reports. Earning $64.9 million -- $55.9 million in of it in stock which he'll vest over the next 5 years, so he isn't just pocketing all of it in cash -- puts Kotick behind Oracle's Larry Ellison, America's top-paid CEO, who earned $96.2 million in 2012. Looking to other game industry execs, Kotick's nearest comparison would be EA's former CEO John Riccitiello, who resigned in March, but made $9.5 million in 2012.

So why the pay raise, an eight-fold increase over Kotick's $8.33 million salary in 2011? It's part of Kotick's new employment contract, which included big bonuses tied to corporate performance. If Activision Blizzard continues to do well, Kotick will keep earning big dollars -- if he hits the highest performance targets, he could be making even more this year.

[Update: Clarified Kotick's stock vesting]

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An article from the LA Times reports that Activision Blizzard Inc. has quietly made some internal changes to senior management and internal organization within Activision: one focused on the military game Call of Duty, another handling internally owned properties like Guitar Hero and the Tony Hawk series, and a third handling licensed properties.

Why these changes weren't relayed to investors or the press is still unknown, but it's likely due to the fact that they could be interpreted as a sign of weakness. Activision has seen flagging sales for two of its former cash-cow franchises, Tony Hawk and Guitar Hero, and a recent very public scuffle with Call of Duty creators Jason West and Vince Zampanella following their ejection from their positions as heads of Activision's Infinity Ward studio painted the studio in a negative light with gamers. This kind of restructuring could point to turmoil within the company, an image that an industry juggernaut like Activision would want to avoid.

So, what do these changes mean for Blizzard, and for World of Warcraft? Activision got a hold of us to say "nothing at all" -- the restructuring was for Activision's side of the business only. It's important to remember that Activision-Blizzard is an umbrella company that contains two separate divisions: Activision Publishing and Blizzard Entertainment. Activision restructured into three different units, but Blizzard remains independent.

Have you ever looked at something new on the auction house and thought "Who would pay a thousand gold for that," only to find that months later the item has skyrocketed in price and you missed a golden opportunity to pick it up on the cheap? Activision kingpin Bobby Kotick might make the same analogy. If he played video games, I mean.

The Escapist clued us in to this little story: back in 1995, Kotick was eating lunch with some folks from Davidson & Associates, and they told him that they had just bought up-and-coming software developer Blizzard Entertainment for the tidy sum of seven million dollars -- a number that a baffled Kotick believed to be ridiculous. At the time, Blizzard's claim to fame was Warcraft: Orcs vs. Humans, and ... that's pretty much it, save for a few one-off games like Blackthorne and The Lost Vikings. Kotick called them nothing more than a "contract developer" and remarked that they weren't worth seven million bucks.

Of course, later that year, Blizzard released Warcraft II: Tides of Darkness, which catapulted them into gaming history forever. Thirteen years later, in 2008, Kotick (and Activision) paid seven billion dollars to acquire Blizzard. For those not into mathematics, that's one thousand times more than what Davidson & Associates paid.

Well, he was right about one thing. They definitely weren't worth seven million bucks. He just didn't know how right he was at the time.

Barron's has a long article up about Blizzard's corporate overlords at Activision-Blizzard, and as is usual with most pieces of Activision news, people will probably see in it what they want to see. Those who think Bobby Kotick is just a money-grubbing exploiter will find more fuel for their firey fanboy rage: apparently he's a follower of Las Vegas casino entrepreneur Steve Wynn, and is modeling some of Activision-Blizzard's business plan off of that guy, Shareholders, however, will probably be thrilled. In terms of a purely financial sense, Activision-Blizzard is apparently one of the shinest futures around, with Kotick bragging that videogames will eclipse film and TV in terms of moneymaking in just a few years.

From our perspective, as longtime fans and players of Blizzard's games, the most interesting thing I see here is that Barron's makes no distinction at all between Activision and Blizzard any more -- the Activision-Blizzard company, according to the article, is equally responsible for both the Starcraft and Transformers franchises. Obviously, as gamers, we see a huge distinction between those two: one is a classic, storied, much-loved videogame series, and the other is a cash-in on a license that's panned everywhere but the box office. But for the financial guys, they're just both properties of Activision-Blizzard. That's not to say that our Blizzard is entirely lost (anyone who was at BlizzCon last week knows that's not true), but it is a sign that the merger is no longer news. From an outsider perspective, Guitar Hero and World of Warcraft are just two cash cows from the same company.

Activision-Blizzard held their second quarter conference call yesterday, and in addition to addressing the Starcraft II delay, both Mike Morhaime and Activision CEO Bobby Kotick shared some insight into what the revamped Battle.net will be like. The brand new system (which is currently up and working, albeit in a very skeleton form so far) will have "social networking features, cross-game communication, [and] unified account management," in addition to features that will let players "share experiences" with each other online (we'd presume that means things like screenshot galleries and leaderboards, but who knows?). Kotick also spoke up, and compared the service to that other popular online community, Xbox Live.

Blizzard is still saying the new Battle.net will come in conjunction with the new Starcraft, so we'll have to keep an eye out for them both in the first half of 2010. It'll be interesting to see what other features Blizzard adds in, and exactly what form features like "cross-game communication" take -- do they mean actual in-game messaging across games, or just status updates and messages on a social network? Kotick's comparison to Xbox Live raises some questions, too, as that's a much wider service than you'd think Battle.net would be. But then again, the guy's a CEO, and all CEOs have a tendency to overestimate exactly what their company is doing. Like most of Blizzard's upcoming releases, we'll have to wait and see on Battle.net.

Gamasutra has received an interesting stat from the good folks at NPD: after hearing that The Sims 3 sold over 800,000 copies in its first month, they were curious to see what kind of unit sales our own World of Warcraft has experienced. And the numbers are pretty big: among the original game and all of the expansion packs since the vanilla release over four years ago, NPD says 8.6 million boxes of WoW have been sold in the US. That's a little misleading if you're comparing it to actual subscription numbers: remember that this is over three different releases (so the actual number of all-time players, not current players, is probably 1/3 of that), and it includes different collectors' editions of each of the three game editions. So there are nowhere near 8.6 million US players of WoW -- that's just how many times players have come through the retail line with the various releases.

What that is, however, is a lot of money. Gamasutra estimates that at an average of $30 for each unit sold (the vanilla game currently retails at $20, but the expansions all sell at $40, and of course the original game was more expensive once upon a time), that's $258 million in income for Blizzard. In short, Blizzard's making a mint at the retail counter, even before they sign anyone up for subscriptions.

Then again, if you look at their own costs, those aren't insubstantial, either -- Activision's Bobby Kotick claimed that anyone starting up an MMO to compete with WoW would have to throw at least half a billion dollars into the mix just to get started, so we can presume Blizzard has spent at least $500 million on their staff, development, and hardware. So it's not like they're taking it all to the bank, though we can at least presume they're sitting firmly in the black.

Yesterday, when we wrote about Blizzard's mistakes in patch 3.0.8, I made very sure to stay away from any mention of Activision. Call me naive, but I still don't think the Activision-Blizzard relationship has yet affected how Blizzard conducts business -- Blizzard's mistake of releasing the patch before it was ready was, in my mind, all their own. But not everyone feels that way (just read the comments on yesterday's post), and Ben Kuchera of Ars Technica will go a step further: he's calling Activision-Blizzard CEO Bobby Kotick out for caring more about how much money his games make rather than how good they are.

We've talked about Kotick here before, and we've got him saying both that Activision will leave Blizzard alone and that they'll be seeking additional revenues where they can get them. But Kuchera isn't so balanced -- he's ready to pin Blizzard's decisions, including the idea to cut Starcraft II up into three different games, and the pending monetization of Battle.net on Activision's influence. And the last nail in the coffin is Kotick's recent profile in Forbes, which apparently had the writer calling Rock Band a "knock-off" of Activision's Guitar Hero (even though history says otherwise, since Harmonix, without Activision, created both franchises).

But that gets a little too far into non-Blizzard territory for us. Kuchera finishes by saying that there's two forces at work in Azeroth: "the loyalty of [WoW's] players" and "Kotick's cash lust." And he questions what will happen when the two finally face off. Which is basically what we've been saying for a long time. But the question so far is whether that's happened or not. Have Activision and Kotick pushed Blizzard to make the Starcraft II and Battle.net decisions, or is Blizzard making all of these choices on their own?

Everyone going to BlizzCon this year will get to roam around the convention hall with some of the very people who bring you World of Warcraft and other Blizzard games. While many World of Warcraft fans might be familiar with the online pseudonyms such as "Drysc" and "Tigole," very few probably know what they actually look like.

We've searched the internet high and low for pictures of these folks and have compiled them into a nice and handy gallery complete with some biographical information. The pictures are small and mobile enough that they can be saved to an iPhone or other mobile device that can be brought into the convention hall.

If you happen to be going to BlizzCon be sure to stop and say hello to these Blizzard people. And if you aren't going, check out WoW Insider during the convention for the latest and greatest reporting right from the floor.

The Wall Street Journal sat down to interview Activision CEO Bobby Kotick, and our little World of Warcraft game got a nice bit of face time (one wonders why no one's asking Blizzard CEO Mike Morhaime about, say, Guitar Hero, but who are we to question the corporate structure?). Kotick says that Activision closely examined what everyone else was doing with MMOs and online gaming, and saw that the only real winner in the market was Blizzard. Rather than investing in their own franchise, then, they decided to just buy Blizzard from Vivendi (and as you know, that's what happened). Kotick says what's so difficult about running these online games is just the scale -- you've got to handle credit card fraud, keep thousands of servers up and running (and patched), and still provide a good experience for millions of players at a time.

Kotick also talks about the way that WoW is sold in Asia (there, instead of paying a monthly fee, many people in Internet cafes pay per hour in cash), and says that Blizzard's experience with setting up a viable pay model may come in handy with other Activision properties overseas, Guitar Hero being his first choice.

We're still not exactly clear on how all of this relationship works -- while both Blizzard and Activision have said in the past that it's hands off, you have to think that even though things are buddy-buddy now while the money's flowing, but what happens when the two sides start to disagree?

The official World of Warcraft Community site has updated its Player Stories section with two new stories from military personnel. Both are short and easy reads, so I'm not going to spoil them here for you. They're kind of heartwarming, and help put WoW in a little bit different light. The stories definitely show another side of why some players play the game.

It's pretty easy for some folks to forget that there are people on the other side of the computer. Real live human beings, who have friends and family. And, for some players, the whole reason they're sitting down at the computer in the first place is to get access to those friends and family. And, remember, even Activision CEO Bobby Kotick says one of the great things about World of Warcraft is its social experience.

Bobby Kotick, CEO of Activision, took the stage at the All Things Digital conference, and spoke a little more about the Activision Blizzard deal.

Kotick fesses up that a lot of the merger was about Blizzard's people. While a pessimist might read this as "we can't compete with them, so join 'em," what I see is a deep level of respect for Blizzard and its creation. Kotick said, "the merger is really our mechanism to get access to Blizzard's talent, capability and infrastructure." This isn't really a surprise, and reinforces what Kotick's had to say about being considerate of Blizzard's culture.

As has been said before, Kotick doesn't seem like a bad guy. What he's doing is acknowledging the good work Blizzard's done in the past. He straight out says that, "I've never seen anything quite like World of Warcraft, not just as a gaming experience, but as a social experience, as a business."

That's not the kind of sentiment issued by someone who doesn't like what they just bought (Ed: But would someone who just spent $18.8 billion on anything not like it?). While Kotick doesn't say directly much about the future of Blizzard, things are still looking good for our favorite Blue team.

Portfolio has an interview with Bobby Kotick himself, warchief of the Activision Blizzard clan, and in there, they talk about the merger itself (obviously), as well as Kotick's past and what he's trying to do with Activision Blizzard.

If you believe everything he's saying, then our favorite game company sounds like it may have landed on pretty good ground. Apparently Activision was originally trying to buy out Vivendi (Kotick says he'd realized that World of Warcraft wasn't so much a game as a full-fledged social network), but Vivendi made the counter-offer of a partnership instead. And while Kotick only chats briefly about Activizzard's other properties (he thinks facial and mouth movement will help videogames tell great stories -- sigh), he does say that Activision is a place where Blizzard can grow as a studio of its own, as compared to a faceless corporation like, ahem, EA.

All in all, Kotick doesn't sound like too bad a guy, although I can't imagine that any CEOs being profiled in something called "Portfolio" would. It does at least sound like he'll let Blizzard do their thing, although just as we've said before, while things are great now when the money is rolling in, there's no knowing what will happen in the future.

[Via WorldofWar.net]

When Vivendi acquired Activision -- or was it Activision acquiring Vivendi? these business deals confuse me -- to form what the soon-to-be Activision-Blizzard late last year, many players were concerned about how this would affect our beloved MMO. Blizzard assured its players with an FAQ on the forums about the merger stating, in no uncertain terms, that it would not affect Blizzard's games in any way (except to improve them, presumably). Activision CEO Bobby Kotick recently spoke with Next Generation, however, and talked very much like the businessman, discussing possible revenue models for their stable of games. He mentions how Activision-Blizzard must figure out StarCraft's business model for the future, "with in-game advertising and sponsorship" which he says "presents a tremendous opportunity for the future."

He illustrates how StarCraft can actually be "the model for in-game advertising and tournament play", spooking at least one World of Warcraft player, who asks on the forums if WoW could be next. Fortunately, Karune chimes in the same thread assuring StarCraft fans (and by extension, WoW players) that Blizzard has "no plans to have in-game advertising in StarCraft II." He explains that "Bobby (Kotick) was actually referring to Battle.net, which has always included ads." It's very reassuring, but perhaps such speculation would be avoided if Activision-Blizzard's CEO actually words things a little better.

This week's round up of WoW-related posts on our sister site Massively covers many different angles of the MMO universe dominated by World of Warcraft. You can click on the links below or subscribe to a special WoW-only Massively feed.

As the Worlds Turn: Get your fix
With so many games out there, presenting different worlds, different rules, different ways to play, what is it that grabs hold of players and, for some, doesn't let go?

Does WoW really need to be 'beaten'?
When will the constant cries of 'Will this be the WoW-killer?' be stifled once and for all? Let's instead concentrate on the far more interesting question: 'Why does there need to be a WoW-killer?'

Pong creator Nolan Bushnell to enter MMO space
The man many call 'the Father of Videogames' -- as he is responsible for founding Atari and creating Pong -- Nolan Bushnell was recently interviewed by GameSpot at this year's GDC.

Behind the Curtain: Should raiders get special treatment?
Loot should always be a secondary concern in MMOs. I've been seeing more and more, the idea that developers should put the concerns of those players whose sole or primary concern is the acquisition of loot above the concerns of other players.

Clan Gear: guild clothing for the masses
Adam and Freya Chapman have run Threadsafe, a direct-to-garment printing business, for the last two years. Now, in conjunction with Adam's brother Keith, they're opening Clan Gear, a direct-to-garment printing outlet for gamers, where the focus on the printing is your artwork, your character, and your designs.
Investment of $1 billion+ wouldn't dethrone WoW, exec says
According to a report, Activision CEO Bobby Kotick stated in an investor meeting that his company had done extensive research on the MMO category, and came to the conclusion that even a game bolstered by an initial investment of $500 million to $1 billion would still probably have a hell of a time competing in the same space as the Blizzard juggernaut.