Following shareholder consent and a nod of approval from the European Commission, the planned merger between video games publishers Activision and Vivendi is now go. The new corporate behemoth is going by the name Activision Blizzard, chosen for Vivendi’s Blizzard Entertainment subsidiary which is responsible for a little indie outfit called World of Warcraft.
Activision Blizzard CEO Bobby Kotick called the merger “the beginning of an important new chapter in the history of interactive entertainment.” “By combining leaders in mass-market entertainment and subscription-based online games, Activision Blizzard has leading market positions across all categories of the rapidly growing interactive entertainment software industry,” he cackled maniacally.
Blizzard CEO Mike Morhaime chimed in, “From the beginning, our goal has been to make the best games in the world, and this transaction strengthens our ability to do just that.” Forked lightning tore gaping rifts the rain-lashed sky as he whispered “As part of Activision Blizzard we’ll have the reach and resources to share our games with an even wider audience – while maintaining the same approach as always to providing high-quality entertainment and services to our players.”
Hours of agonising, unholy transactions across the dark void in the financial heavens are now set to follow. Vivendi will receive 295 million newly issued
souls shares of Activision common stock, and it is purchasing approximately $1.7 billion in additional shares, giving the company just over 50 percent ownership of Activision Blizzard. In a few days, 146.5 million shares will be put up at $27.50 per share by the company.
This merger brings with it a major headache for former publishing top-dog Electronic Arts, not only because it is being knocked off a number one spot it has enjoyed for years, but also because a number of Activision Blizzard and EA IPs are fighting for the same market space. Increasingly popular music games such as Activision’s Guitar Hero and EA’s Rock Band are already involved in a pitched battle, and the increased might of Activision Blizzard (please could someone decide on a decent abbreviation for that – ActiBliz, maybe?) will only increase the competition further.
Not that that is in any way a bad thing for consumers (Vivendi’s integration brings greater scope for music licensing, which means longer, cheaper set lists), but it seems less and less likely any agreement will be made over compatibility issues with some versions of the instrument peripherals. Once Guitar Hero makes the inevitable step to a full blown selection of band instruments, the situation will likely get worse.
EA’s woes might not end there though. Rumours suggest that Activision Blizzard might now be encouraged to have a look at GTA IV publisher, Take-Two, as a possible acquisition. EA has been involved in a long and laborious effort to acquire the company since well before the launch of the fourth iteration of the hugely popular series. Other analysts also point out that Activision Blizzard might itself a bit busy with all the complicated paperwork surrounding the merge, even in spite of the undeniable appeal of “stirring the pot” for its closest rival. It would certainly have to get its act together as the current EA offer closes on August 21st, unless it delays AGAIN.
Even Apple, dear sweet humble Apple, isn’t escaping Activision’s demonically enhanced gaze. Kotick told the FT that he’s got his eye on iTunes and wants to develop an online music platform to rival the dominating service. “I don’t think there have been a lot of credible alternatives to iTunes, but Guitar Hero certainly has that potential,” Kotick said, but failed to provide any real explanation as to how a plastic guitar game might hope to rival the world’s most popular brand of digital music player. Other than through dark majiks, obviously.