A Storm is Brewing at Blizzard Entertainment
Game developer and publisher, Blizzard Entertainment, has been hitting headlines in the past few months for all the wrong reasons. From the disappointing announcement of Diablo: Immortal which angered many fans, to the combination of two CFOs resigning within two days of one another in the first week of 2019, it’s clear that my favorite developer, Blizzard, has a rocky future ahead.
To begin my grieving process for the beloved creator of World of Warcraft, Starcraft, Diablo, and Overwatch, I compiled a timeline of what I see as important moments in the history of the company, and some moments that signal its decline, including the recent resignations of many pivotal figures in the Blizzard executive team, such as Mike Morhaime, one of the three co-founders of Blizzard.
1991 - What is now known as Blizzard is formed by three UCLA grads: Mike Morhaime, Frank Pearce, and Allen Adham as Silicon and Synapse, Inc.
1994 - Silicon and Synapse, Inc. becomes Chaos Studios, Inc.
1996 - CUC International acquires Davidson & Associates (which included Chaos Studios, Inc. and is renamed Blizzard Entertainment) in a $1.8 Billion stock swap. (CUC International later becomes Vivideni Games).
July 2008 - Activision merges with Vivendi Games, and becomes Activision Blizzard.
July 25, 2013, Activision Blizzard announces the purchase of 429 million shares from majority owner Vivendi, thus becoming an independent company.
September 2016 - Chris Metzen, Senior Vice President of Story and Franchise Development (Creative director of Warcraft III: Reign of Chaos), retires.
April 2018 - Ben Brode, Hearthstone Game Director and Hamilton Chu, Executive Producer of Hearthstone, leave to form the game studio Second Dinner.
August 2018 - Yong Woo, Hearthstone Production Director, also leaves to join Second Dinner.
August 2018 - World of Warcraft: Battle for Azeroth launches, and though incredibly successful in sales, over time becomes a large disappointment to its fanbase in terms of gameplay, bugs, and lack of compelling endgame content.
October 3, 2018 - Mike Morhaime, Blizzard CEO and Co-Founder, resigns. (Bolded for how significant this is).
November 2018 - The announcement of Diablo Immortal, the mobile Diablo game, causes immense backlash in the community.
December 13, 2018 - Blizzard suspends Heroes of the Storm e-sports events for 2019 and removes developers from the game.
January 2, 2019 - Spencer Neumann, the CFO of Activision Blizzard, is terminated by Activision Blizzard and subsequently hired by Netflix.
January 4, 2019 - Amrita Ahuja, Blizzard Entertainment CFO, resigns and takes a position at Square.
As you can see, Activision really takes over Blizzard in 2013, when it’s able to purchase majority shareholding from Vivendi. Having gone through a fairly large merger myself, and working in Human Resources, I imagine the subsequent year (2014-2015) is when a great deal of the restructuring of the two companies took place. Usually in a merger the parent company goes one of two ways: leaves its subsidiary’s culture in place and simply tries to make some efficiencies across the two entities, or tries to integrate the subsidiary as much as possible into the parent company. What I’d guess is that folks like Mike Morhaime, Chris Metzen, and other senior executives at Blizzard were able to advocate against Activision for the former.
What I can see happening now, however, is the latter. It’s clear that the Activision-Blizzard parent company is asserting its rule over Blizzard Entertainment, and things aren’t getting better for the employees of Blizzard; they are just getting worse. With notable high level team members such as Ben Brode, Mike Morhaime, and Amrita Ahuja leaving, it must be clear to the employees of Blizzard that the writing is on the wall and the company will never be the same game developer it was when it released World of Warcraft or even Overwatch. As much as it pains me to say, the games that Blizzard builds for the future will be for investors, and not for the players.
Though I still have hope, I know I’ll be pressing ‘F’ to pay respects for my favorite game developer fairly soon.
I’ll leave you with a section of an article from Kotaku writer Jason Schrier, written in November 2018 about the backlash against Diablo Immortal:
“Traditionally, Blizzard has remained entirely separate from Activision, with its own quality standards and branding, to the point where they felt like two different companies. You might be able to find World of Warcraft Easter eggs in StarCraft II, but you’d never see an Overwatch character in Call of Duty. In recent years, however, that’s changed. Blizzard’s digital store, Battle.net, now features Activision games like Destiny 2 and Call of Duty: Black Ops 4. Bungie appeared on the BlizzCon 2018 stream to announce that Destiny 2 would be temporarily free. And there’s been a perception among Blizzard developers that the two companies are growing more and more intertwined.
As it turned out, 2018 would be a weak year for Activision. The publisher was unhappy with Destiny’s performance and would take a major stock hit in November following fiscal third-quarter results that disappointed investors. One worrying trend for the bean-counters was the stagnancy of Blizzard’s MAUs—monthly active users—which are seen as a pivotal metric for service games like Hearthstone and Overwatch. Throughout 2018, as Activision has told investors, those numbers have declined. Combined with Blizzard’s lack of new games, it’s easy to see why Activision’s executives may have wanted to intervene.
“You would’ve thought Blizzard was going under and we had no money,” said a former Blizzard staffer, who told me they left the company this year in part because of Activision’s influence. “The way every little thing was being scrutinized from a spend perspective. That’s obviously not the case. But this was the very first time I ever heard, ‘We need to show growth.’ That was just so incredibly disheartening for me.””
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