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Activision Thought $7M for Blizzard was "Insane"

Activision CEO Bobby Kotick says he thought $7 million USD was an "insane" price for Blizzard Entertainment when Davidson & Associates purchased Blizzard back in 1995. He describes a conversation at an dinner with Davidson & Associates where his reaction was: "Are you out of your minds? They’re like a contract developer! They have Warcraft but what else do they have? You paid SEVEN million! That’s insane!" 12 years later Activision and Blizzard merged in a deal reportedly worth $18.8 billion USD.

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43. Re: Activision Thought $7M for Blizzard was "Insane" Jan 21, 2010, 09:06 Verno
 
Really?!

I told you this two months ago, Psygnosis is studio liverpool
 
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Playing: Fire Emblem, Diablo 3, Bravely Default
Watching: The Machine, After the Dark, Devils Due
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42. Re: One of these days... Jan 20, 2010, 18:28 Jerykk
 
RTSs? Come on, how many are released each year?

Quite a few? Here are a bunch of 2009's strategy (some real-time, some turn-based) releases:

Empire: Total War
Warhammer 40K: Dawn of War 2
Halo Wars
Stormrise
Tropico 3
Hearts of Iron 3
Elven Legacy
King's Bounty: Armored Princess
Majesty 2
Anno 1404
King Arthur
Men of War
East India Company
Blood Bowl
Order of War

As you can see, strategy games are far from dead. Are they as popular as shooters? Of course not. Shooters are currently the most popular "hardcore" genre.
 
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41. Re: Activision Thought $7M for Blizzard was Jan 20, 2010, 09:32 InBlack
 
Yifes wrote on Jan 20, 2010, 06:30:
So I guess you'd have nothing bad to say about guys like Hitler, Stalin, Bundy, etc. etc. I mean, after all, you really don't know them, and neither did most people so how dare they go around calling them names!

You're seriously invoking fucking Hitler when talking about Kotik? Because you know, running Activision and killing 6 million Jews, close enough.

Hehehe that was pretty funny....But he was obviously exaggerating to hit home with his point. Everytime someone mentions Hitler people star getting heart attacks.

Dude, he isnt beetlejuice! Its not like he is going to pop up if we "invoke" his name three times.

Are we going to start having cock-fights about who was more evil next??
 
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40. Re: Activision Thought $7M for Blizzard was Jan 20, 2010, 06:30 Yifes
 
So I guess you'd have nothing bad to say about guys like Hitler, Stalin, Bundy, etc. etc. I mean, after all, you really don't know them, and neither did most people so how dare they go around calling them names!

You're seriously invoking fucking Hitler when talking about Kotik? Because you know, running Activision and killing 6 million Jews, close enough.

This comment was edited on Jan 20, 2010, 06:42.
 
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39. Re: Activision Thought $7M for Blizzard was Jan 20, 2010, 00:59 Donkey_Punch
 
Hellbinder wrote on Jan 19, 2010, 14:10:
You all need your brains washed out with bleach.

Oh fuck off you closed minded bible thumping hate monger.
 
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38. Re: One of these days... Jan 19, 2010, 23:20 Kxmode
 
mag wrote on Jan 19, 2010, 19:36:
Psygnosis: Bought by Sony in '93, actually still around.

Really?!
 
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37. Re: Activision Thought $7M for Blizzard was "Insane" Jan 19, 2010, 20:40 The PC Warrior
 
i hate kotick as much as the next dude but you guys are faulting him for not being able to predict the future ten years away. think about how dumb that is for a minute, most of you would be rich SOBs if you could do that. wait a second, kotick still is rich. funny how that one turned around on yall.  
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36. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 20:36 Cutter
 
Yet he keeps them employed, keeps their bonuses strong and keeps their stock options growing.

Fancy that.

Oh, wait, the CEO has nothing to do with how insanely successful Activision has been in the 2000s. I forgot.

Really? And you know that how for a fact? They keep him employed, not the other way around. And I'm sure their bonuses are probably the least he can get away with. And stock options? Yeah, since when do the rank and file get ANY stock options nevermind preferred stock options? And for all their hard work and his ass-hat-ery he reaps all the rewards while they eat cake. You vastly overrate the importance of CEOs and what they do. Any one with 1/2 a brain could be one.
 
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James Woods: Oh that's fun. That sounds like you had a fun time. Where would I fit in with the fun time, huh? Where does James Woods fit into the fun?
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35. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 20:33 Cutter
 
I still think it is wrong to call people you really don't know vile names, but that's my humble opinion.

So I guess you'd have nothing bad to say about guys like Hitler, Stalin, Bundy, etc. etc. I mean, after all, you really don't know them, and neither did most people so how dare they go around calling them names!
 
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James Woods: Oh that's fun. That sounds like you had a fun time. Where would I fit in with the fun time, huh? Where does James Woods fit into the fun?
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34. Re: One of these days... Jan 19, 2010, 20:03 Vindicus
 
I'm just saying the signs of success were there pre-WoW.

There weren't in 1994. As mentioned, they hadn't even bought the company that made Diablo.

Sure Warcraft was their only hit at the time, but it was one of those games a lot of garnered a lot of attention and a benchmark in gaming. Someone was wise enough to invest.

None, and nearly all of them. Lots of the talent that made successful games in 95 are still in the business.

Not of that list.

From Wikipedia (not that it's a totally reliable source), "Ex-Looking Glass personnel have worked on such games as Deus Ex, Guitar Hero, Rock Band, Half-Life 2, Freedom Force, The Elder Scrolls IV: Oblivion, Fallout 3, Bioshock..."

That's more than I expected! But I guess I just look at it differently than you, in that even though the companies have dissolved, the hearts and souls of these companies are still out there making the same type of games they initially got in the business to make.

And therein lies a huge part of the problem: talent isn't enough. Quality of games isn't enough. If a handful of people leave an entire studio can completely fall apart. Look at Rare.

Yes, it's business. It's a risk like any investment. That's what people like Kotick are paid to judge. I make the occassional mistake at my job, so does he obviously. Later on you can laugh at them, which I think is the point of this article -- only he may be crying inside at the same time.

JA is more a turn-based strategy. Dead. RTSs? Come on, how many are released each year? FPS of course are successful.

Fallout 3 has a system called V.A.T.S. which enables a turned-based strategy sequence in the game. In fact many modern games allow you to pause and employ strategy. I'd have to argue not dead. If there was a good way to bring RTS to consoles, you bet developers would be cranking them out. I'm sure someone is working on it. Meanwhile nearly every RTS release on PC has been pretty successful, even some surprise indy successes like Sins of a Solar Empire.

Nearly everyone in this thread not us.

Gotta love the Internet.

 
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33. If Activision purchased them, they wouldn't. Jan 19, 2010, 19:53 Addikt
 
At that time, if Activision had bought them for $7M, I don't think they would have done World of Warcraft. It would have been deemed too risky, and they would have been drained of all life and discarded like every other development studio that I liked  
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32. Re: One of these days... Jan 19, 2010, 19:36 mag
 
Other top games of 1995 include:
Marathon 2 (Bungie)
Warhammer (Mindscape)
Command & Conquer (Westwood)
Jagged Alliance (Sir-Tech)
Descent (Parallax)
Flight Unlimited (Looking Glass)
Heroes of Might and Magic (New World Computing)
Destruction Derby (Psygnosis)
I Have No Mouth And I Must Scream (Cyberdreams)


How many of these companies are still around?

How many of these companies are no longer around because EA (or someone else) bought and destroyed them?

Bungie: Purchased by MS, turned into a Halo-factory.
Mindscape: Company sold in 1994 for $500 million, development team was sold to and eviscerated by EA in 1997 (undisclosed amount), company sold in 1998 for $150 million, then sold in 1999 for $3.6 billion.
Westwood: Eaten by EA in 1998 (for $122 million!).
Sir-Tech: Closed on its own. Kept releasing games until 2001.
Parallax: Released Descent II, split into two companies in 1997, both later purchased by THQ, one of which (Outrage) was subsequently shut down. (Volition sold for ~1 million shares of stock, which looks like it was $10-12/share at the time. Can't find a figure for Outrage). Volition made super-awesome Freespace and Freespace 2 and has continued to make mediocre-to-bleh Red Faction and Saints Row games.
Looking Glass: Closed in 2000, mostly because of Eidos. Was bought and sold a couple of times, released a bunch of popular games (The IP rights of which are probably worth a lot).
New World Computing: Eaten by 3DO in 1996 ($13 million), subsequently dissolved in 2003.
Psygnosis: Bought by Sony in '93, actually still around.
Cyberdreams: Failed on its own.

Pretty much probably Cyberdreams is the only one that wouldn't have been worth more a couple of years later (when they were mostly purchased). It's difficult to say exactly how they would have fared individually after that, given that they were largely shut down by their parent companies, and with the hard times of the early 2000s.
 
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31. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 19:33 Dev
 
This thread is very fun to read.

ASJD:

You should watch what you say, ppl have gotten arrested for less.

This comment was edited on Jan 19, 2010, 19:33.
 
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30. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 19:19 Kxmode
 
Cutter wrote on Jan 19, 2010, 17:57:
I'm sorry. Shall I call him a worthless little gnome, instead? No, I kinda like cockbag.

I'd go with douchebag, but cockbag works. People that don't think Kotick and guys like him are douchebags - or cockbags - clearly don't know anything about and how they work. I can guarentee you that the majority of people that work for assholes like that agree with us.

I still think it is wrong to call people you really don't know vile names, but that's my humble opinion.
 
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29. Re: One of these days... Jan 19, 2010, 19:01 Beamer
 
I'm just saying the signs of success were there pre-WoW.

There weren't in 1994. As mentioned, they hadn't even bought the company that made Diablo.

None, and nearly all of them. Lots of the talent that made successful games in 95 are still in the business.

Not of that list.

It's hard to say whether or not a company like Looking Glass would have thrived. I place the quality of their games right up there with Blizzard.

And therein lies a huge part of the problem: talent isn't enough. Quality of games isn't enough. If a handful of people leave an entire studio can completely fall apart. Look at Rare.

Oh let's see, the FPS. No. Nobody plays that. Nobody likes Bungie or Halo. RPG like Jagged Alliance? No again. Games like that and Fallout 3 just don't do well. RTS's have flopped huge which is why Age of Empires was a huge non-success for Microsoft, and Starcraft II will fail in a big way. Racing and driving games? Continue to flop, no interest. Casual adventure games? Well, Myst sealed the coffin up on that genre and it's completely useless which is why they're pretty much the one of the few computer game genres places like Target and Walmart still carry -- but what do they know about making money? Complicated Flight Sims... well I'll give you that one.

JA is more a turn-based strategy. Dead. RTSs? Come on, how many are released each year? FPS of course are successful.

Did I call him braindead, or did you just do that? Perhaps he just shouldn't have guffawed at the idea.

Nearly everyone in this thread not us.
 
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http://www.hydrahead.com
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28. Re: One of these days... Jan 19, 2010, 18:46 Vindicus
 
You knew this in 1995, before Diablo was announced? When Diablo was being made by Condor games, prior to Blizzard buying Condor in 1996?

No. I'm not saying I did, and it's not about me anyway. I'm just saying the signs of success were there pre-WoW.

How many of these companies are still around?
None, and nearly all of them. Lots of the talent that made successful games in 95 are still in the business.

How many of these companies, if you put $7 million into them in 1995, would have paid off?
Hard to say until it's done. But I wouldn't have bawked and laughed at the idea of dumping it into several on the list there. It's hard to say whether or not a company like Looking Glass would have thrived. I place the quality of their games right up there with Blizzard.

How many of these games are genres that are even profitable now?
Oh let's see, the FPS. No. Nobody plays that. Nobody likes Bungie or Halo. RPG like Jagged Alliance? No again. Games like that and Fallout 3 just don't do well. RTS's have flopped huge which is why Age of Empires was a huge non-success for Microsoft, and Starcraft II will fail in a big way. Racing and driving games? Continue to flop, no interest. Casual adventure games? Well, Myst sealed the coffin up on that genre and it's completely useless which is why they're pretty much the one of the few computer game genres places like Target and Walmart still carry -- but what do they know about making money? Complicated Flight Sims... well I'll give you that one.

And you still think Kotick is braindead for not knowing this?

Did I call him braindead, or did you just do that? Perhaps he just shouldn't have guffawed at the idea.

 
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27. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 18:05 Beamer
 
I can guarentee you that the majority of people that work for assholes like that agree with us.

Yet he keeps them employed, keeps their bonuses strong and keeps their stock options growing.

Fancy that.

Oh, wait, the CEO has nothing to do with how insanely successful Activision has been in the 2000s. I forgot.
 
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http://www.hydrahead.com
http://www.painkillerrecords.com
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26. Re: Activision Thought $7M for Blizzard was Jan 19, 2010, 17:57 Cutter
 
I'm sorry. Shall I call him a worthless little gnome, instead? No, I kinda like cockbag.

I'd go with douchebag, but cockbag works. People that don't think Kotick and guys like him are douchebags - or cockbags - clearly don't know anything about and how they work. I can guarentee you that the majority of people that work for assholes like that agree with us.
 
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James Woods: Oh that's fun. That sounds like you had a fun time. Where would I fit in with the fun time, huh? Where does James Woods fit into the fun?
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25. Re: One of these days... Jan 19, 2010, 17:53 Beamer
 
Even without WoW, Blizzard (I've no doubt in my mind) would continue to succeed, because later on Diablo 2 would sell 4 million units worldwide.

You knew this in 1995, before Diablo was announced? When Diablo was being made by Condor games, prior to Blizzard buying Condor in 1996?

And no, the closest counterpart to Blizzard (imho) in terms of success was id, and they released Doom in 1993.

Seriously? Doom sold 5 million copies. The original Warcraft didn't even hit 1 million. And, for the record, Blizzard was sold before the Warcraft 2 launch. And, for the record, Blizzard was sold before it was called Blizzard. Kotick is wrong, Blizzard was sold in 1994.

Other top games of 1995 include:
Marathon 2 (Bungie)
Warhammer (Mindscape)
Command & Conquer (Westwood)
Jagged Alliance (Sir-Tech)
Descent (Parallax)
Flight Unlimited (Looking Glass)
Heroes of Might and Magic (New World Computing)
Destruction Derby (Psygnosis)
I Have No Mouth And I Must Scream (Cyberdreams)


How many of these companies are still around?
How many of these companies, if you put $7 million into them in 1995, would have paid off? Bungie, Blizzard and...
How many of these games are genres that are even profitable now? No, Warcraft pretty much isn't.

And you still think Kotick is braindead for not knowing this?
 
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24. Re: One of these days... Jan 19, 2010, 15:21 Vindicus
 
Of course Kotick couldn't know about WoW, but by 1995 video games on the computer were becoming huge money-makers, and starting to match Hollywood in terms of revenue. The first Warcraft had already brought Blizzard moderate success, enough so that they released the sequel in 1995. And Blizzard just continued to make games and franchises that topped their previous efforts. Even without WoW, Blizzard (I've no doubt in my mind) would continue to succeed, because later on Diablo 2 would sell 4 million units worldwide.

And no, the closest counterpart to Blizzard (imho) in terms of success was id, and they released Doom in 1993.

And I don't hate any publishers, but I couldn't help but chime in, because even back then people were claiming the death of PC games.
 
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