Activision Blizzard may see its share price increase as much as 50 percent as it prepares to launch the Mists of Pandaria expansion for World of Warcraft and Call of Duty Online in China, financial newsweekly Barron’s reports. Activision Blizzard is currently trading at $11.25, after reporting Q2 earnings above expectations but below the previous year, bringing in $1.08 billion.
Investors expect shares could reach a high of $17 due to Mists of Pandaria’s launch in September and Activision’s partnership with Chinese Internet provider Tencent Holdings to launch the free-to-play game Call of Duty Online, potentially in "mid-2013," Barron’s says. The Chinese gaming market generated $7 billion and included 160 million gamers in 2011, and is expected to grow by 20 percent this year to cash in more than $9 million in 2014.
Activision Blizzard’s shares have fallen 10 percent this year, while the broad market has gained 11 percent. Parent company Vivendi was looking to sell its 61 percent stake in Activision Blizzard earlier this year, but it appears those efforts have shifted focus.
Updated: Feb. 9, 2011; 5 p.m. PST
It’s game over for Guitar Hero.
Activision Blizzard will close its music-game business division, laying off hundreds of employees, and cancel the Guitar Hero game that was in development for 2011, the publisher said in a conference call Wednesday.
The drastic move comes after significant industrywide declines in the music game business. In 2007, Activision sold 1.5 million copies of Guitar Hero III in its first month of sales. Last year, Activision only sold 86,000 copies of the latest game in the series, Guitar Hero: Warriors of Rock. Slowing sales of chief competitor Rock Band led Viacom to sell maker Harmonix and close the MTV Games publishing division.
Activision said that the decline of the genre, plus the high cost of licensing music and producing the games, led it to close the business.
“There was nothing that Activision or anybody could have done to save Guitar Hero,” said Jesse Divnich, vice president of analyst services for Electronic Entertainment Design and Research, in an interview with Wired.com. Divnich said that Activision realizes the “opportunity cost” of continuing to make Hero games when it could instead be putting those resources towards more profitable games.
Divnich said that the casual gamers that made up the majority of guitar games’ audience have now moved on. “if your primary hobby is not gaming, you get your fill quicker on entertainment products,” he said.
The publisher will also cancel upcoming game True Crime: Hong Kong. It said the cancellation of these two projects and the layoffs will affect 7 percent of its roughly 7000 employees worldwide, or about 500 people total.
But Activision said that it expects its net headcount to bounce back to that 7000 number by the end of the year, since it is making further investments into a new massively multiplayer online game from its Blizzard division, makers of World of Warcraft, and into new Call of Duty projects like a free-to-play game for the Chinese market and a suite of online services for players of the military shooter games called Project Beachhead.
Although Guitar Hero is a goner, games built around music “will never die,” Divnich said. “Harmonix has [Kinect game] Dance Central, and that took off huge. [Publishers] just need to find the next big thing.”
Move over, Activision. Here comes Activision.
Call of Duty: Black Ops sold 5.6 million copies in 24 hours, making it the biggest entertainment launch ever, Activision said Thursday. This breaks the previous record of 4.7 million, which Activision set last year with Call of Duty: Modern Warfare 2.
“There has never been another entertainment franchise that has set opening day records for two consecutive years,” Activision CEO Bobby Kotick said in a statement.
The game is also on track to outperform last year’s five-day global sales record, which was $550 million, Kotick said.
Activision places the total one-day sales figure at $360 million, which is an okay amount of money, I guess. It makes you wonder, though — do 5.6 million people really care about Call of Duty, or did they all just want to play Zork?
Valve claims that the complaint was not officially submitted to the “contractually agreed audit and dispute process” and states that the auditor thus refused to consider it. So, what did Activision do? It paid $1,967,796. Yup, that’s exactly $424,136 less than the awarded amount. Furthermore, Activision stated it would sue Valve if the company attempted to have the court confirm the total payment due.
Undaunted, Valve is now asking that the court award it the deficient payment and officially close the arbitration process, thus barring Activision from attempting to re-open it. More legal fireworks, it would seem, are about to ensue.