Bobby Kotick interview: Why Activision Blizzard did the deal with Microsoft

Some bits:

GamesBeat: Why do the deal? Why is this a good time to sell? And why is it a good price as well?

And so when Phil called, it happened to be at a time where we were getting ready to start our long range planning process, and realizing that these were going to be issues and challenges. We had the discussion. Phil and I know each other well, and we have a great relationship, and the company has a great relationship. And when you start to think about all the skills we need, all the resources we need, and what they have, it made a lot of sense.

When they originally called, we said we would we think about it, and then they made this offer that was incredibly attractive at 45% premium over the stock price. And I think it just made a lot of sense. And so, the more we spent the time talking about how it would work, and what would happen, what resources were available, they clearly were the best partner.


GamesBeat: And was the sexual harassment investigation factor in this, as it certainly seemed to affect the stock price?

Kotick: I think what affected the stock price more than that is pushing out Overwatch and Diablo. And then I think people started to see that this year’s Call of Duty wasn’t performing as well. So I think certainly the [California Department of Fair Employment and Housing] filing and the Wall Street Journal article contributed to that, but stocks go up and down for a variety of reasons. I think our view was that at $95 a share with all cash, that’s a really great deal for our shareholders. And so that was an easy and independent judgment. It’s a great deal.

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45% premium on Acti’s stock under a year ago would have been over 100 billion dollars, so MS really did get a discount.

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Microsoft simply smelt blood and took advantage of the opportunity to get Activision at a discount.

Yeah, it make sense why they accepted an offer at that moment, cause after month or so, it could be even less.

He is predicting other publishers buyout, he said even an Acti-Bliz-EA merger wouldn’t have been sufficient for todays market.

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This is why the stock prices of other publishers went up because investors know this is not the end. The industry is going through major consolidation and Microsoft has got a serious head start.

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Reading the interview and Bobby is like: maaan, it’s really hard to be a 100B company these days. Wth?

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When the heads of the companies suck most of the money out then yes its hard

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I’m glad MS prevented Tencent from buying huge western publishers, I’m sure they were looming behind Zenimax and Acti-Bliz, they already own stakes everywhere.

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Remember when Phil said Sony isn’t Xbox’s competition it’s Amazon and Google and the internet got offended? This is what he was referring to. Large corporations with unlimited pockets competing for content. Sony isn’t playing the same game as they are.

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This is also why I think it’s much more likely that Amazon or Google acquire Sony than Sony acquiring anyone else.

To compete you need a parent company with deep pockets.

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I still think Tencent and facebook are the real threats, they are really within gaming, Google outside reaping on the Play Store cut isn’t doing nothing significant with Stadia (almost 3 years now) and Amazon can’t really tie another market to Prime, it’s already on the brink of being (for real this time XD) unsustainable, even for them. Apple is in a similar position to Google: why bother to risk tens of billions when we got billions doing literally nothing because of a legalized duopoly? Not coincidentally one of the suitors for Acti Bliz was FB and I’d bet the other was Tencent.

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I more meant companies of those size

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The fastest track for Facebook, Google, or Amazon to have legitimacy within the gaming sphere is to have a recognizable brand, which is Sony.

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I think the other suitor fo Acti Bliz other than FB was Tencent indeed, which also has minor stakes in Acti Bliz.

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I am sure the White House is glad as well lol. For all the talk of the DoJ getting involved potentially I can assure you that they are much happier that Microsoft is buying them than Tencent.

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Yep, the deal will go through precisely because the alternatives were a chinese corp (most likely) and one of the most scrutinized member of FAANG for bad practices (Meta).

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Or remember when people were glancing over to what Sony was doing when they purchased their studios and getting concerned? Sony is not fishing in the same body of water that Microsoft is.

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this is what phil meant by sony aint competition

“The deal came together entirely from my unrivaled galaxy brain, me and phil being best bros, and our ideas for the future! Definitely not my mismanagement, indifference to human suffering, and general sociopathy…”

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