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Rumor: Vivendi plans to sell Activision Blizzard

Rumor Vivendi plans to sell Activision Blizzard
Bloomberg reports that Vivendi is looking to sell its 61 percent holding in Activision Blizzard, according to "a person with knowledge of the situation." If they are unable to find a purchaser for the entire $8.1 billion stake, they will attempt to sell part of it on the open market.

Again, this is just a rumor, but the CEO of the French Company just quit this week during a board meeting, reportedly due to a disagreement about selling off the huge telecommunication and media company's assets. The Wall Street Journal reports that "people familiar with the matter" claim that the board is considering splitting up Vivendi outright.

Until the rumor is confirmed and the success of the sale or spinoff is resolved, we will not know the fate of Blizzard or World of Warcraft. Those who say the sale of Blizzard to the merger of Blizzard and Activision brought down the quality of the game may laud the situation, while others will add this to the many reasons they claim that WoW is doomed. But speculation is just that, and we'll keep an eye out for actual facts as they happen.

Filed under: Blizzard, News items, Rumors

ATVI is a "conviction buy"

Well, The9 is going down in flames, but if you're looking to make some money in the stock market lately, you could do like BRK and buy some stock in Activision-Blizzard. Goldman Sachs has upgraded ATVI to "buy," and even marked them out as a "conviction buy" -- while the stock price is almost $11 right now (it jumped up about .75 on this news this morning), GS says it's headed to $14 eventually. "Conviction buy" just means that the wily traders at Goldman Sachs expect the stock to outperform in the future -- Activision is already saying it will do well, but GS thinks it'll do even better.

Medievaldragon over at WorldofWar.net points out that there may still be trouble ahead: while Blizzard has gone with Netease for their service in China, they still have to make it past the Chinese government's approval process, and there may actually be service outages if things aren't approved quickly. But that won't affect Activision's business very much, and given that the company still has a bright future (even in a harsh economy), picking up a few shares is probably a relatively good investment.

Please note: I am not a financial expert, and none of this should be taken as serious financial advice. You invest in the stock market and any other financial institution at your own risk. If you're getting stock tips from WoW Insider, it's probably better to keep your money in your pocket. AH tips, on the other hand...

Filed under: Odds and ends, Blizzard, Economy

NetEase to buy all new servers for Chinese WoW


Yes, as you may have noticed in the update on our post the other day, it's confirmed: NetEase will be taking over operating the World of Warcraft in China as of June -- their new homebase over there can be found at wow.163.com. And while we originally reported that The9 would be turning over their software, hardware, and staff to run the game, apparently that's not completely true. IDG News Service is reporting that NetEase will be setting up their own network of servers to run the game. That's a big undertaking -- it likely means that things will be bumpy for the first few days of the transition (though Blizzard is clearly confident that NetEase can handle it, having run a few other games in the market before). And it also means that some of the supercomputers we've reported on before that are owned by The9 will go to... well, we're not sure what.

Not that there aren't plenty of things to use them for -- despite their stock dropping on news of the WoW license loss, The9 also runs a number of other games over there, including Guild Wars, Ragnarok Online, and a few more popular Eastern MMOs (not to mention that EA has a nice stake in them). And at the very least, there's got to be a market for supercomputers with other companies and educational institutions, right? It's unlikely that all that hardware will just sit dark.

But more importantly, it'll be interesting to see how NetEase handles the transition -- we've had a few inventory and other issues here on the Western side of the world, but we've never had a major loss of character information (cue all of the Blizzard engineers knocking on wood). We're sure there are countless backups in place, but if something goes majorly wrong in the transition between hosts, it could be devastating for the WoW audience in China.

Filed under: Analysis / Opinion, Blizzard, Hardware

Activision-Blizzard stock falls

What's going on at Activision-Blizzard? Yesterday, their stock fell back down to the lowest its been since November of 2006. Even coming off of huge sales last year (they run the Guitar Hero, Call of Duty, and obviously Blizzard's World of Warcraft franchises, all of which had banner years in 2008), the stock price fell 6.5% yesterday, compared to a high in the last year of $19.28.

It's not Wrath -- the game's been selling like gold encrusted hotcakes since launch. There could be an upcoming shakeup in Activision's leadership (is Bobby K on his way out?), or it could just be that as well as Activision did this past year, the rough economy is hitting them hard, too.

At any rate, this will likely be just a bump in the road -- Activision is poised to become (if they haven't already) the biggest publisher in the game, and as you can see from this graph on their website, the stock is already back up above $9. We don't know what the reason is for this quick drop, but everything else we've seen points to a bright future for Activision-Blizzard.

Filed under: Analysis / Opinion, Odds and ends, Blizzard, News items, Making money, Wrath of the Lich King

Activision doing well, Blizzard has spent $200M in upkeep on WoW

Activision Blizzard (the parent company of Blizzard Entertainment) held an Analyst's Day earlier this week (in which a bunch of stock analysts sit down to crunch numbers and predict the future), and they came out of it really well -- according to those in the know, Activision Blizzard is set to do very well in the future. Buoyed by Blizzard and their other big franchises (do we have to name them by now? Call of Duty, Guitar Hero, etc.), 99% of analysts give the stock a "Buy" or "Hold" rating, and many were impressed with what Activision told them about their releases in 2009.

And we got another interesting insight into just what kind of money Blizzard is looking at -- they reported on the call that since 2004, they've spent $200 million on the upkeep of World of Warcraft alone. That includes things like payroll, customer support, and hardware updates, of which there have been plenty of those. $200 million does seem like a lot, but of course when you consider just how much revenue they've pulled in via subscriptions (ten million players paying up to $15 a month, though Blizzard has all kinds of different subscription plans around the world), $200 million over four years isn't all that much.

We're told, though, that that money doesn't include any development costs (pre-release, and we're not sure if it includes patch/expansion development or not, either). And it certainly doesn't include Blizzard-wide costs, like their new HQ, or what they spend on advertising, promotion, and those big events held around the world. There's no question, however, that there's plenty of money coming both in and out of Blizzard's doors.

Filed under: Analysis / Opinion, Blizzard, Expansions, Making money, Hardware

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