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Rob Anderson

Prof. R. Muhlbock

INDS 1033-40

November 26, 2010

Activision Blizzard: The Other Big Fish

The Video game industry has evolved into a demographically diverse industry surpassing

the interests of younger kids. The average age of a gamer is 34 years old in 2010 (“2010 ESA

Essential Facts”). Activision Blizzard or formally known as Activision since 2007, founded in

1979 by Vivendi SA Conglomerate located in Paris France. Electronic Arts (EA) has

traditionally been seen as the largest video game company in world with the release of 783

games total to date (“Electronic Arts”). In fair competition Activision has released 210 games

(“Activision Games”) since they started, but still have managed to generate higher net revenue

last year than EA. Activision plans to continue dominating the mature (M) market by continuing

the Call of Duty series. Activation’s in-depth Hero line up will help create a sustainable

competitive advantage over EA’s Rock Band series. History shows that Activision can

continuously bring out bring high volume ground breaking games to the marketplace. Activision

predicts it will have a greater market share than its competitors for years to come (“Web Archive

PDF”) due to frequent M & A’s positioning them ahead of EA and their smaller competitors.

A closer look into Activision reveals where they stand today and were they will take

control of video game and online gaming industries in years to come. After closing recent merge

with online video giant Blizzard Entertainment, they immediately will became global leaders in

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dynamic, high margin subscription-based online games business with opportunity to migrate

Activision franchises online (“Web Archive PDF”). 2009 was a great year for the Blizzard

Entertainment and the World of Warcraft team winning Guinness World Record for most

popular MMORPG game after hit the 12 million subscriber plateau. (“2009 Awards

Joystiq.com”) Honourable mentions also went out for selling 9.5 million copies of PC & Mac

best selling game Starcraft. Activision now has the knowledge they need to bring the rest of the

fleet online and make it impossible for EA to stop them. EA would need to invest a lot of money

if they ever expect to release an online first player shooter multi-console game to over throw Call

of Duty’s growing success and popularity.

Violence in video games equals big bucks these days and Activision has capitalized on

just that. The latest instalment of Call of Duty Black Ops shattered Activision’s previous 5 day

sales record of $550 million bringing in $650 million this time around. (“2010 News Factor”)

Those who also partnered with Activision also managed to break records, Microsoft’s Xbox Live

recorded 2.9 million unique users played on the first day. (“2010 Yahoo News”)

"Call of Duty has become the first entertainment property in history to set five-day launch records for two consecutive years across all forms of entertainment, The number of people playing online and the number of hours they are playing demonstrates how online gaming has become a mainstream form of entertainment." said Robert Kotick CEO of Activision Blizzard.

(“2010 Yahoo News”) EA also tried to penetrate the console music industry with release of Rock

Band that still lacks the competitive edge Activision has had year after year with their Guitar

Hero series.

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In 2005 Activision stole the show by releasing the first interactive guitar console game

just before Christmas on November 5 2005. (“Wikipedia”) Since the first release countless new

and collector additions have been brought to the marketplace for almost all platforms, including

mobile devices (iPods/iPhones). In 2009 Guitar Hero was recognized as the best selling rhythm

game series (“2009 Awards Joystiq.com”). Shortly after Activision released DJ Hero which

helped to continually place them in the number 1 spot for this category. Activision has deeper

roots than just COD, GH, WOW, and Starcraft the Tony Hawk Pro Skater franchise brought on a

whole new kind of gaming before the new millennium.

Activision and Neversoft teamed up and revolutionized how we played video games on

the console with the first release of Tony Hawk Pro Skater for PS. The Tony Hawk series has

released 16 games since all which huge success across multiple platforms over the last decade.

Video game addiction also helped bring this franchise to new levels, most early adopters of the

game regardless of talent played for hours on end. The Tony Hawk franchise was quick to

release a female skater to help open up to the female market. (“1999 IGN”)

Activision continues to build games for all ages and genres, such depth will allow them to

dominate the industry. Being able to influence kids at a young age to like your brand or games

will help establish your brand with a new generation of customers. 25% of the gaming industry

players are under the age of 18 (“2010 ESA Essential Facts”) which is a market they plan to

target more in the future. EA is traditionally known for their Sports games but will they be able

to hold onto their big price tag licences long enough before someone the other big fish comes

along?

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Activision has paid their dues so far to the gaming industry and bought out whoever else

they could, to claim the number spot. In fair competition Activision has released 210 games

(“Activision Games”) since they started, but still have managed to generate higher net revenue of

$4.28 Billion (“Activision Blizzard Investor”) last year than EA which generate $4.21 (“VJ247”)

. Activision plans to continue dominating the mature (M) market by continuing the Call of Duty

series. Activation’s in-depth Hero line up will help create a sustainable competitive advantage

over EA’s Rock Band series. History shows that Activision can continuously bring out bring

high volume ground breaking games to the marketplace. Activision predicts it will have a greater

market share than its competitors for years to come (“Web Archive PDF”) due to frequent M &

A’s positioning them ahead of EA and their smaller competitors. Activision is a bigger and better

video game company than EA.

Work Cited

“ACTIVISION :: GAMES” “Activision Games” < http://www.activision.com/index.html#games|en_US>

“Investor survey on gaming”

<http://investor.activision.com/releasedetail.cfm?releaseid=437653>

“Yahoo Activision/EA stats”

<http://finance.yahoo.com/news/Research-on-Activision-iw-1006149487.html?x=0&.v=1>

“Top 25 companies 2010”

<http://www.softwaretop100.org/top-25-gaming-companies-2010>

“Stats from esa 2010”

<http://www.theesa.com/facts/pdfs/ESA_Essential_Facts_2010.PDF>

“210 games”

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<http://www.activision.com/index.html#games|en_US>

“Black ops”

< http://news.yahoo.com/s/nf/20101118/bs_nf/76147>

“List of Activision games”

< http://en.wikipedia.org/wiki/List_of_Activision_games>

“Joystiq Awards”

< http://wow.joystiq.com/2009/06/08/mike-morhaime-and-paul-sams-accept-guinness-world-record-awards/>

“News Factory”

< http://news.yahoo.com/s/nf/20101118/bs_nf/76147>