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By Staff
Activision Blizzard announced their financial results for Q1 2023 and we have the highlights.
Highlights
For the quarter ended March 31, 2023, Activision Blizzard's net bookings were $1.86 billion (up from $1.48 billion for Q1 2022). In-game net bookings were $1.29 billion (up from $1.01 billion for Q1 2022). Activision Blizzard generated $577 million in operating cash flow for the quarter (down from $642 for Q1 2022). Microsoft plans to acquire Activision Blizzard for $95 per share in an all-cash transaction, which has been approved by the board of directors of both Activision Blizzard and Microsoft and by Activision Blizzard's stockholders. Blizzard segment revenue increases 62% year-over-year in Q1, with each of Warcraft, Overwatch, and Diablo contributing to growth. Segment operating income was broadly stable year-over-year, reflecting development and marketing costs, including launch investments ahead of the Q2 Diablo 4 release. Following the November release of Dragonflight, the WoW team is delivering more content faster than ever before, and subscriber retention in the West is higher than at the equivalent stage of recent Modern expansions. Diablo Immortal contributed to Blizzard's Q12 net bookings growth with the game experiencing stable trends across engagement, retention, and player investments. Warcraft: Arclight Rumble continues to progress well through regional testing. Diablo 4 will launch on PC and console on June 6. Public testing of the game in March saw very high engagement and positive feedback, and strong pre-sales. This ambitious title will serve as the launch for a compelling live service, with regular seasons and story-driven expansions planned to drive engagements for many years to come. Blizzard monthly active users dropped by 40% (from 45 million in Q4 2022 to 27 million in Q1 2023). Source: Investor Activision
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A Misunderstanding May Have Been the Cause of Activision Blizzard Games Not Being Available in ChinaBy Starym
The break in Activision Blizzard's partnership with NetEase in China which happened in January this year cost many Chinese players the ability to play Blizzard games, and today the New York Times may have some insight as to how the relationship between the two gaming giants might have gone wrong.
While tensions had been building for years before the final negotiations last year, ranging from NetEase's investment in Western studios Activision wasn't happy with (former Activision-owned studio Bungie being one), in the end the fate of Chinese players' Blizzard accounts may have come down to a misunderstanding. The Zoom call in question happened last October, between Activision Blizzard CEO Bobby Kotick and NetEase chief executive William Ding, and involved translators at certain points in the conversation.
As reported by the New York Times, based on accounts from 4 people familiar with the talks and a document they reviewed, the call was part of the standard re-negotiation of licensing rights between the two companies. The discussion arrived at the topic of the merger between Activision Blizzard and Microsoft and the scrutiny it had come under all around the world, but particularly in China. According to two people familiar with the call and the document reviewed by the New York Times, Activision executives recalled that at a certain point Mr. Ding said NetEase "could sway the [Chinese] government either to block or support that deal depending on the outcome of the licensing discussion." Reportedly the Activision executives felt that the statement was meant as a threat, but NetEase executives claim they did not intend to make any threat. They stated that they were just trying to be conciliatory towards Activision, meaning to simply point out that Microsoft would have the same issues Activision now had with the Chinese regulators, and that the new deal NetEase was proposing would help in both situations. A NetEase spokesman flatly denied that there were any threats as well, saying that Activision was continuing to "harass and taunt companies and regulators worldwide."
NetEase employees tearing down the Gorehowl statue in China.
Source: chaijingNDS on TikTok, via Dexerto.
After the call Activision reportedly made a completely different licensing offer, for approximately $500 million upfront, as opposed to the previous smaller payments throughout the course of the deal, which NetEase rejected. There was also a quite literal last ditch effort on the part of Activision later on, asking to extend the existing deal for 6 months as it looked for a new Chinese partner, but that was also rejected by NetEase. Finally, on January 23rd 2023, most of Activision Blizzard's games were shut down in China, with players not being able to access their characters, which some had spent over a decade and a half building. And while their data has been saved, it is still unclear when or even if they will be able to use those accounts and characters again.
The New York Times article has many more details about the two companies' dealings, so make sure to check it out over here, as it is very eye-opening.
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By Staff
About 12 billion hours of Blizzard games were played and 50 million new players joined the Blizzard community this year, according to Blizzard President Mike Ybarra, who posted an update reflecting back on 2022.
Additionally, Blizzard is bringing back BlizzCon. More information will be available early next year.
(Source)
Hey everyone! It’s been about a year since my last post, and with 2022 coming to an end, I felt it was a good time for an update.
2022 has been a great year for Blizzard, made possible by the hard work, creativity, and passion of everyone who works here, and the support, feedback, and joy from the players. Putting people first—employees and players—is how we’re building the foundation of the next era of Blizzard.
A lot of this work has been internal, but I hope you can see the results of it in our games: the joy and love for Azeroth in World of Warcraft: Dragonflight, the color and scale of seasonal updates in Overwatch 2, the care and respect in Wrath of the Lich King Classic and Diablo II: Resurrected, the creativity and charm in Hearthstone, and the gameplay and rich story built into Diablo Immortal. We also got to show off the chaotic glee built into Warcraft Arclight Rumble, and finally the Diablo IV team got to relish in the excitement with a recently announced June 6, 2023 launch date.
About 12 billion hours of Blizzard games were played this year, and as many as 50 million new players joined the Blizzard community*, and this would not have been possible if not for the passion from the people within Blizzard. We’re hearing from them that there is a fundamental shift happening, and it’s the thousands of people who work here who are steering this ship toward something greater than we’ve ever been—and we’ve only just begun.
To give some clarity on what’s happened this year, I promised in January that we would hire full-time positions to support the ongoing work of improving the culture at Blizzard.
We welcomed Jessica Martinez as our VP of Culture, a brand-new role at Blizzard. We announced Makaiya Brown as our DE&I lead. We have welcomed a new Chief People Officer this year, J.D. Roux. Additionally, we’ve made several important changes to our teams:
Blizzard cofounder Allen Adham, Chief Design Officer: Championing game design as a discipline, helping to ensure we keep Blizzard gameplay at the forefront of the player experience. Holly Longdale, Executive Producer of World of Warcraft: After leading WoW Classic, Holly now oversees all of World of Warcraft, bringing her deep MMO experience to the fore. Jared Neuss, Executive Producer for Overwatch 2: Taking a holistic approach toward building a great live-service experience for this incredible universe. Peiwen Yao, Executive Producer for Diablo Immortal: Leading the co-development partnership for our debut mobile-first title. April McKee, Executive Producer of BlizzCon: Yes, we’re bringing BlizzCon back—more on that early next year! Mike Elliott, Chief Technology Officer: A Blizzard veteran and engineering’s leading voice, overseeing technical evaluations, recommendations, and execution. Dan Hay, General Manager of Survival Game: Leading the team which is infusing this genre with Blizzard magic while crafting our first new IP since Overwatch. The team has doubled in size this year and we’re looking to grow it even more in the new year! *New Battle.net accounts created and at least 1 Blizzard game played. Rebuilding the Foundations
While we have full-time roles dedicated to culture, culture isn’t the work of one person or team. It involves all of us every day, and it requires perspectives and insights of different experiences, backgrounds, functions, and identities. To this end, we convened a culture team consisting of a wide array of functions across Blizzard who are helping us improve how we work, and create and sustain a culture that makes all of us better.
One of the other major projects this year has been taking a deep look at the mission, vision and values upon which Blizzard was built. We have been talking about how these values are interpreted and lived, how they could be improved or modernized, and everyone at Blizzard had the chance to have their voice heard in this critical work. This is a project that our employees, as well as players, will see the results of in the new year.
We’ve also made solid progress advancing Diversity, Equity, and Inclusion (DE&I): we held a successful fourth Women's Summit, we deployed DE&I-focused training across all employees, we’ve expanded self-identification options to be more inclusive, and over the past year, we increased the percentage representation of women and non-binary people within Blizzard from 22% to 25% while also increasing the percentage of employees from under-represented ethnic groups from 34% to 36%. While this is progress, our commitment is that our focus on culture and inclusion will be a core part of our everyday efforts at Blizzard. This work will never be done. For you – our players – our hope is that you are seeing it in our games, the way we communicate, and more. We’re learning along the way, and it’s all of you who are keeping us on the right track.
We have received a lot of feedback this year, and our teams are always listening—as we grow in these areas, we have had important moments that help us learn and be better. Our players are always quick to let us know what they are thinking and feeling, and for that, I want to thank you. I’m three years into my journey at Blizzard, and not long into having the privilege of playing a small role in leading Blizzard forward. It’s inspiring to work here: every day, I learn from Blizzard and learn from you, and as we close out 2022, I couldn’t be more thankful for that.
Finally, to our wonderful teams at Blizzard: thank you. We’re on a journey together to create an amazing culture that fosters and enables creative energy and fresh thinking. Together we’re bringing Blizzard back, better than ever.
Take care this holiday season: spend time with loved ones, your favorite games, your favorite movies and books, and take the time for yourselves. We’ll be doing the same.
I’ll see you in Azeroth, Sanctuary, the tavern, and in the optimistic vision of the future!
- Mike “Qwik” Ybarra
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By Starym
Here's some potentially bad news for the sale of Activision Blizzard to Microsoft, as Politico is reporting that it is likely the US FTC will be filing a lawsuit to stop the acquisition - based on three sources "familiar with the matter". A lawsuit could postpone the deal's timing and even endanger it altogether, regardless of its result.
The acquisition deal has seen a lot of pressure and antitrust probes coming from many sides (including several other countries' regulating bodies and watchdog organizations), as it could constitute an unfair boost for Microsoft's side. The most vocal voice against the sale is Microsoft's chief console competitor, Sony, who argues that the sale would open the door to making many Activision Blizzard games (mostly focusing on Call of Duty) exclusive to Microsoft platforms. This, Sony argues, would significantly disadvantage Sony platforms and leave consumers with less choices for gaming.
A lawsuit challenging the deal is not guaranteed, and the FTC’s four commissioners have yet to vote out a complaint or meet with lawyers for the companies, two of the people said. However, the FTC staff reviewing the deal are skeptical of the companies’ arguments, those people said.
The investigation remains ongoing, but much of the heavy lifting is completed, including depositions of Microsoft chief executive Satya Nadella and Activision head Bobby Kotick, the people with knowledge of the investigation said. If the agency does move ahead with a case, it could come as soon as next month, said the people, all of whom were granted anonymity to discuss a confidential matter.
- Politico's Josh Sisco
Well known gaming industry journalist Jason Schreier also weighed in on the story as well:
You can read the full Politico article here, as it goes in to detail about both Microsoft and Sony's arguments so far, as well as Google and Epic's involvement.
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By Starym
A pretty big bombshell was dropped a couple of days ago, as Blizzard announced the end of their partnership with NetEase and a possible end of their games being available in China. We've seen the official posts and responses, but there's a lot of context missing there. Luckily for us, however, well known Chinese WoW community figure NasDa has jumped in to explain things and add some new information and even rumors.
There's actually quite a few new elements presented below, from a rumor of an (unlikely) potential new partner for Blizzard, an explanation on how exactly publishing and certification work in China and how long it takes, the potential Microsoft involvement, the fact that the last time Blizzard did something like this China got WotLK almost a year later, and more.
The below is from a TwitLonger by NasDa:
All the base knowlegde you need to know about this Blizzard-NetEase CATASTROPHE.
- Foreign game companies must work with a domestic game publisher who will operate the game in China. That's why you never see CN region on Blizzard's map when a new patch is about to hit the live servers. CN region is basically in another "parallel universe". It's like peeing in a dark rainy night, you know it's definitely there, but you can't really tell where.
- The publishing partner for Microsoft in China is NetEase, ironically.
- Chinese law requires all digital games to receive a license from the regulator to be published in China.
- In the past getting a game license is not an issue. Since last year it's been extremely difficult for any game, domestic or foreign, to receive a license, even more so for the latter. Last time a foreign title received a lisence was over 500 days ago. Popular ones like PUBG, Fortnite, Apex and Valorant still don't have their Chinese publishing licenses yet. All Tencent games.
- China has resumed issuing new game licenses since April, for dometic games.
- Changing a publishing partnership means re-applying for game licenses even if the games are already approved by the regulator and it could take months or even years.
- This is the second time Blizzard changes their Chinese publishing partner. 14 years ago, Blizzard ended the partnership with their first partner, The 9, and then started worked with NetEase. Combining the process of re-applying for new game license for TBC expansion due to changing the partnership from The 9 to NetEase and the difficulty of getting a game license for WotLK expansion, the original Burning Crusade exapanion in CN region lasted for a total of 1090 days. Chinese players were forced to play LK pre-patch for 19 months. Imaging playing TBC for 3 whole years.
NetEase launched WotLK expansion in CN region on 31/08/2010. Just giving you an idea of how late that was. Paragon killed Arthas on 26th of March 2010. LOL. This is one of the reasons why LK classics is so popular in China.
Now you can see why Blizz and NetEase's "divorce" is widely considered to be a BLOODY CATASTROPHE by the Chinese community.
- Potenital buyer or interesting parties:
miHoYo, the developer of Genshin Impact, has denies the rumors of licensing deal with Blizzard;
Tencent replied that there was no relevant news internally for the time being;
Perfect world is another hot candidate according to rumors;
My source told me(and it's a good source), ByteDance, the parent company of Tiktok will be the successor or at least in the lead.
"Does ByteDance have any experience of operating a game before?" Ye, that was my first question but I guess time will tell.
- NetEase has promised that they will be issuing refund for all the players that still have remaining blizzard bucks and active game time in their accounts.
- After 24th of Jan. all Blizzard services in China will be shutting down. I still don't know what to do after that and where to play wow yet.
Thanks a lot to NasDa for all this information and I really do hope something can be done before January 23rd, as I cannot even imagine simply losing your entire WoW account, not to mention other Blizzard games - even temporarily, and especially with the potential of it being permanently gone. There are so many Chinese players who are part of the WoW community it would truly be a tragedy to see them lose everything they worked, a decade+ of time invested into the game could simply disappear.
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