Activision Blizzard Q1 2021 Investor Call

[Osmeric]

Activision-Blizzard is who people are applying to. People here don't seem to understand that Blizzard and Activision are two separate gaming compnanies under that roof and continue to falsely believe that Activision owns everything when it isn't the case.

People are just using the word "Activision" to refer to Activision-Blizzard. Realize that in the deal with Vivendi, Blizzard was merged into Activision and the corporation that had been called Activision was renamed Activision-Blizzard. This corporation now had a segment named Activision, but CEO was (and is) Kotick.

[Xorzor]

People are just using the word "Activision" to refer to Activision-Blizzard.

No no no. It's CHINAVISION-BLIZZARD!

@DesoPL asks an excellent question. Who in their right mind would want to work for such people? Whether directly working for Chinavision or one of their assimilated drone studios doesn't matter. It's one thing to want to work, and of course there's nothing wrong with that. It's entirely something else to be so desperate that you sell your dignity to a company run by the obese incarnation of the sin of Greed.

[gobio]

No, they are exactly the same thing.
Without profit a company will go out of business and the game will be shut down.
Without profit a company will not invest in further development of its product and no new content or expansions will be made and then the game will be shut down.

This is so dumb

Answer me this Mr. "profit and heath are EXACTLY the same thing" guy.

If a company produced a lower than expectation game that damaged its reputation, and the CEO decided to lose profit by fixing it. Does this action makes the company more healthy or less healthy?

Answer me this?

[Dhrizzle]

There's a reason why they stopped showing sub numbers and there's a reason they lumped all Blizzards MAUs into one.

It serves as a better metric for Blizzard's value to existing and potential investors.

[Nyel]

Well, with the prices for the TBC Classic boosts and CE announced we know how they're going to make money in the future. And guess what, it's not quality games, it's disgusting overpriced micro transactions and account services.

[Dhrizzle]

People are just using the word "Activision" to refer to Activision-Blizzard. Realize that in the deal with Vivendi, Blizzard was merged into Activision and the corporation that had been called Activision was renamed Activision-Blizzard. This corporation now had a segment named Activision, but CEO was (and is) Kotick.

Not exactly, Activision was merged with Blizzard's parent company Vivendi Games. Blizzard kept a similar level of autonomy with the new company (renamed Activision-Blizzard) while a new division Activision took control of all old-Activision's and Vivendi Games' studios.

Fast-forward a few years and Vivendi SA (the big-daddy company) were feeling a bit bloated and looking to shed some of their divisions. Acti-Blizz were one part they were looking to get rid of, including options to strip out the assets and sell off IPs piecemeal, which is when Kotick and other higher-ups went to get loans and investors and burned through cash reserves to buy its independence.

[T-34]

If a company produced a lower than expectation game that damaged its reputation, and the CEO decided to lose profit by fixing it. Does this action makes the company more healthy or less healthy?

Answer me this?

If a company produces a wonderful game, but the cost were so high that it couldn't get any customers to pay a price that would produce a profit, is that a healthy company?

The quality of your product is completely irrelevant if you can't make a profit out of selling it. Quality does not equal profitability.
The only way to measure if your product/service is good or not is if it makes your company a profit.

I am not saying that a company should make shitty products/services in order to be profitable and thereby healthy. I am saying that a company's health can only be measured by its profitability, no matter how people perceive its products.

If it sells and makes a profit then it is good.

Added:
Just to clarify: I have the exact same respect/love for Blizzard as I have for any other multi-national big dick company, which is exactly zero, but I greatly admire their ability to make a profit within the parameters of our capitalist society.

[Osmeric]

Not exactly, Activision was merged with Blizzard's parent company Vivendi Games. Blizzard kept a similar level of autonomy with the new company (renamed Activision-Blizzard) while a new division Activision took control of all old-Activision's and Vivendi Games' studios.

There's a subtle distinction here. The question is, what is the legal trail of identity of the corporation that is now Activision-Blizzard?

Under your scenario, the old Activision ceased to exist. Its stockholders, their shares now referring to a nonexistent entity, would have had to have been issued new shares in a new corporation.

But if Vivendi's subsidiary was merged into Activision, those shares would remain valid. Vivendi would be (and was) issued new shares, obtaining a majority stake, but that would have happened even under the process you are imagining.

This second scenario is simpler and faster, and I believe if you go back and look at the various SEC filings it's what happened.

[Dhrizzle]

There's a subtle distinction here. The question is, what is the legal trail of identity of the corporation that is now Activision-Blizzard?

Under your scenario, the old Activision ceased to exist. Its stockholders, their shares now referring to a nonexistent entity, would have had to have been issued new shares in a new corporation.

But if Vivendi's subsidiary was merged into Activision, those shares would remain valid. Vivendi would be (and was) issued new shares, obtaining a majority stake, but that would have happened even under the process you are imagining.

This second scenario is simpler and faster, and I believe if you go back and look at the various SEC filings it's what happened.

Isn't that what I said, or is there a legal difference between the terms "merged with" and merged into?" The key point I was making is Blizzard wasn't merged with Activision, Vivendi games was merged with (or into) Activision and Blizzard went from being a subsidiary of Vivendi Games to being a subsidiary of Activision-Blizzard.

[Osmeric]

Isn't that what I said,

No, it's not the same. You were saying that Activision was merged into another corporation. That would have meant that Activision, as a corporate entity, would have ceased to exist. This is distinct from merging INTO Activision, which means that Activision remained in existence as a corporate entity (with all the associated legal paperwork and filings).

It's like the difference between being an organ donor and a transplant recipient.

[MoanaLisa]

People are just using the word "Activision" to refer to Activision-Blizzard. Realize that in the deal with Vivendi, Blizzard was merged into Activision and the corporation that had been called Activision was renamed Activision-Blizzard. This corporation now had a segment named Activision, but CEO was (and is) Kotick.

For what it's worth my comment was in response to the statement that Activision was going to add more developers. Someone replied that who would want to work for Activision. That's nonsense. Most of them won't be working for Activision directly. Many of those new gigs will supposedly be with game studios in Europe. The fact is that when you apply for a job at Blizzard as, well, anything you deal with Blizzard HR. These new jobs will certainly be the same. Studios will hire who they like and it's ludicrous to assume that anyone in Santa Monica is going to be watching with any interest. Their interest is how well the studio performs, not the details of who is getting hired.

See #164 for how people are getting it completely wrong.

[Dhrizzle]

No, it's not the same. You were saying that Activision was merged into another corporation. That would have meant that Activision, as a corporate entity, would have ceased to exist. This is distinct from merging INTO Activision, which means that Activision remained in existence as a corporate entity (with all the associated legal paperwork and filings).

It's like the difference between being an organ donor and a transplant recipient.

Ah, so Vivendi bought Activision, merged Vivendi Games into Activision, renamed the merged company Activision-Blizzard, created a new subsidiary called Activision to deal with most of their studios and Blizz maintained the same relationship with A-B as it did with VG.

[Pann]

Ah, so Vivendi bought Activision, merged Vivendi Games into Activision, renamed the merged company Activision-Blizzard, created a new subsidiary called Activision to deal with most of their studios and Blizz maintained the same relationship with A-B as it did with VG.

Vivendi did not buy Activision. Activision purchased Vivendi Games (including Blizzard) from Vivendi which was financed by shares (around 60% iirc) in Activision which was renamed Activision-Blizzard.

[Acidbaron]

Key points i get from this are.

More promises of more developers, no more promises of premium content for WoW.
No mention of veterans leaving the building aka the people who made the games.
More practices to ensure whatever of the player base is left is milked to so that revenue keeps being higher despite losing players.
Focus on more "new people" what means they don't care about the older base that much any more because those who still stuck around have a high tolerance for their practices or perhaps i am too cynical and this just means even more focus on mobile games, because it's all more revenue driven now and mobile games just earn more than risky new IP projects.

In short i wouldn't be looking to buy stock from Blizzard for long term investment (10 to 20 years). I do see them do financially better and better but not sure how far into the future.

Them doing financially better will come at the cost of their core games and fans, the way WC3 remake was handled and still is to this day shows the level of respect there currently is for the player base.

Glad i am no longer invested in any of their games, doesn't look like there will be a bright future ahead.

[Dhrizzle]

Vivendi did not buy Activision. Activision purchased Vivendi Games (including Blizzard) from Vivendi which was financed by shares (around 60% iirc) in Activision which was renamed Activision-Blizzard.

Activision wanted to buy Vivendi Games (actually they were more interested in Blizzard for their expertise in keeping players engaged online) but Vivendi SA wouldn't go for it. I don't know what financial jiggery-pokery it all gets filed under but the end result was Vivendi SA owning the controlling share of the merged company Activision-Blizzard and in 2013 Acti-Blizz had to find backing to buy themselves out from the parent company.

[Pann]

Activision wanted to buy Vivendi Games (actually they were more interested in Blizzard for their expertise in keeping players engaged online) but Vivendi SA wouldn't go for it. I don't know what financial jiggery-pokery it all gets filed under but the end result was Vivendi SA owning the controlling share of the merged company Activision-Blizzard and in 2013 Acti-Blizz had to find backing to buy themselves out from the parent company.

That's exactly what I said - Vivendi sold Blizzard to Activision which was paid for by giving Vivendi a majority holding in Activision.

[CaptainV]

Well, with the prices for the TBC Classic boosts and CE announced we know how they're going to make money in the future. And guess what, it's not quality games, it's disgusting overpriced micro transactions and account services.

Well I did say before the report things would be bleak, now im just confirming it at this point.

Not trying to rub it in, I basically am simply saying this was inevitable.

Microtransactions have become heavily popularised by blizzard since id say... well, since MoP introduced boosting and the Token.

Overwatch Skins, HOTS Skins, HS cardpacks (granted these are services) but wow itself took this with the promotion of mounts tied to 6 month sub packages, or a fairy outfit.

[Gorsameth]

Quality games take a lot of time and effort to make and in return you get a 1 time 60 bucks payment.
Micro-transactions offer so much more income on top of the game itself that its simply logical for companies to increasingly turn towards it.

[Osmeric]

The future of the game is P2W and DLC. Top players, expect borrowed power to become rented power, with the BIS power ups being available for $$$.

Shave the whales.