In the gaming world, few titles thrill gamers as much as World of Warcraft, Call of Duty, Guitar Hero, and Tony Hawk do. In a move designed to create one of the world's largest gaming and entertainment companies, French company Vivendi and San Diego based Activision announced yesterday that Blizzard Entertainment and Activision would merge, in a deal worth over $9 billion. The new company, Activision Blizzard, will own all those aforementioned titles and present a challenge to the size and dominance of Electronic Arts as the world's largest gaming company.
Blizzard owns a number of popular titles, including the epic space-strategy game Starcraft and the magic-and-fantasy game Diablo. But Blizzard's most notable title and perhaps its largest franchise is the massively multiplayer RPG World of Warcraft, which boasts over 9.3 million global subscribers. Activision, on the other hand, has enjoyed success in recent years thanks to the Call of Duty franchise, the immensely successful Guitar Hero series of games, and its Tony Hawk and Spider-Man titles.
The merger of the two companies makes sense, because Blizzard's focus in recent years has been on PC gaming and development, whereas Activision has made significant strides in the console gaming market by creating must-have titles for the Xbox 360, PlayStation 3, and Nintendo Wii. The two companies combined can complement each other's development houses, and in the end, Vivendi will have majority ownership in both companies. Vivendi also owns a number of other game development companies, such as Sierra and Valve, both with popular PC and console titles in their portfolios.
Vivendi sees a significant money stream from its most popular title, World of Warcraft, whose subscribers (myself included) pay a monthly fee to meet with friends, raid dungeons, arm and equip characters, and quest endlessly for hours. 9.3 million subscribers paying, on average, $14 to $15 to play adds up to significant revenue for Blizzard, and Vivendi is looking to spread the wealth around.
The move is meant to round out game platform development and provide Vivendi with inroads to the console gaming market while enjoying the success of its PC gaming division. At the same time however, the new company will be a powerful force in the gaming industry and tough competition to Electronic Arts, owner of blockbuster titles such as the Madden series of football games, Mass Effect, Rockband, and Medal of Honor.
The merger is a multi-step process that's expected to complete in 2009, and investors in both companies have applauded the deal. For more information on the merger, check out the full story at PCMag.com.
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