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Bobby Kotick, the former CEO of Activision Blizzard, made a recent appearance on the Grit podcast discussing his career in videogames. One of the threads is Blizzard Entertainment, a studio that Kotick clearly feels is capable of best-in-class entertainment but also one that was in some respects mismanaged: This is, of course, from the perspective of a profit-first businessman.
“A thing I noticed,” observes host Bing Gordon at one point, “nobody who’s ever left Blizzard seems to have done great… there’s some secret sauce there.” Which is obviously an over-simplification of the situation: Hundreds of hugely talented but lesser-known names have come and gone at Blizzard over the decades. But it’s clear what he’s driving at as Gordon names senior leadership like Mike Morhaime and Chris Metzen, which is that sense that nobody’s really left Blizzard and created the new Blizzard, or even something close to it.
“Look, when we bought Vivendi Games you can’t imagine what these guys were doing,” says Kotick. “They had 25 different development projects that were not the Blizzard franchises, they had a social media division, they had a mobile gaming business, they had like thousands and thousands of people and the whole company wasn’t making any money. Only Blizzard is, and only World of Warcraft is making any money.”
Kotick felt such an environment wasn’t doing Blizzard any favours, and had led to stagnation around the studio’s golden goose. Necessary context for the start of the next response: Activision merged with French media publisher Vivendi to form Activision-Blizzard in 2008, before five years later Activision-Blizzard spent $8.2 million buying back the majority of Vivendi’s shares in the company.
“And so we traded for the company and my view is World of Warcraft is going to continue,” says Kotick. “But you have to make it less taxing and demanding on your time. Because you couldn’t enjoy it and be competitive in it without playing four hours a day. And people age out. They have kids. You just couldn’t play it.”
But the game’s broad appeal was obvious, and the business model had proven a masterstroke even if, inevitably, players did age out of it (I know I did). “You’d be shocked,” says Kotick. “150 million people churned out of World of Warcraft [over its history]. That’s a crazy number. Those are people paying $15 a month. It was the best subscription business of all time.”
At this point the host, who’s sure to be a favourite among gamers, suggests that the only issue was that a WoW subscription could’ve been priced more highly. Surprisingly enough Kotick pushes back against this idea, though that’s only because he thinks there are better ways to monetise such an audience.
“We never raised the price,” says Kotick. “My view was we come up with value-added services, come up with new things to sell, but just leave the price. We could figure out how to come up with other things to sell them. And it’s a prickly audience, you know? You don’t wanna do too much to agitate them. And even a dollar increase would’ve been a problem in my view.”
A notable element there is Kotick’s understanding of WoW’s audience, which may not be appreciated by many players but I think is broadly accurate from the perspective of a publisher. MMO players tend to be incredibly invested in and protective of their chosen game, and while some suits would think that’s a no-brainer for a year-on-year increase in the subscription price, Kotick saw even a dollar increase to the baseline subscription as creating a problem the publisher didn’t want. He was still laser-focused on getting money out of players, of course, but these kinds of instincts are what saw wild success for Activision-Blizzard and that eventual $68.7 billion sale to Microsoft.
Some may find the tone of this business-focused podcast galling, because Kotick left Activision Blizzard in 2023 under something of a cloud and remains something of a villainous figure among gaming fans: The epitome of the cutthroat capitalist out for profit over artistry. Kotick casually pronouncing on the failures of Vivendi should also be taken in the context of his own failure to adequately deal with systemic sexism and harassment problems at Activision Blizzard.
But no one can deny that Bobby Kotick understands the videogame business. And arguably wasn’t wrong about Blizzard either: Among other things Kotick thinks the Warcraft movie was a disaster, burning out Chris Metzen to the point he left was a huge mistake (and Kotick was behind his return), and that the studio had lost focus on serving WoW players. WoW is now arguably in something of a golden age. You do wonder where it would be now if Vivendi stayed in charge.
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Kurt Indovina
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