Understanding the Strategies of Activision Blizzard, Inc.
What is the vision of Activision Blizzard, Inc.? Activision Blizzard, Inc.’s corporate vision is to be a “worldwide leader in the development, publishing, and distribution of quality interactive entertainment software, online content and services that deliver a highly satisfying entertainment experience (Activision Blizzard – 2013 SEC Form 10-K/A Amended Annual Report).” Horizontal Integration & Synergy; Activision Blizzard, Inc.’s approach to success. Activision Blizzard, Inc. is “a worldwide online, personal computer, console, handheld, and mobile game publisher (Activision Blizzard – 2011 Annual Report).” The company was created via the merger of Activision, Inc., Sego Merger Corporation, Vivendi S.A., VGAC LLC, and Vivendi Games, Inc. (Activision Blizzard – 2013 SEC Form 10-K/A Amended Annual Report). Utilizing horizontal integration, the merger integrated “ownership of production facilities, distribution channels, exhibition outlets and ultimately allowed the formerly separate companies to profit from the others expertise (Turow 175).” The new company uses three separate operating segments. Activision Publishing, Inc., Blizzard Entertainment, Inc., and Activision Blizzard distribution. Activision Blizzard, Inc. holds “leading market positions across every major category of the rapidly growing interactive entertainment software industry (Activision Blizzard – 2011 Annual Report),” and is a classic example of synergy, “a situation where the final product is more valuable than the sum of it individual parts (Turow 175),” at work. What is the competitive environment for Activision Blizzard, Inc.? “The interactive entertainment industry is intensely competitive with new products and platforms regularly introduced. Competitors vary in size from small companies with limited resources to large corporations who may have greater financial, marketing, and product development resources than Activision Blizzard, Inc. (Activision Blizzard – 2013 SEC Form 10-K/A Amended Annual Report).” Whom is Activision competing with in the marketplace? “Activision Blizzard, Inc. competes primarily with other publishers of PC, online and video game console interactive entertainment software. Most similar in operating structure is Electronic Arts, which has the largest portfolio of blockbuster games, including many sports titles, and other game franchises with long histories of success. Sony, Nintendo and Microsoft compete directly with them in the development of software titles for their respective platforms. They also compete for the leisure time and discretionary spending of consumers with other interactive entertainment companies, as well as with providers of different forms of entertainment, such as motion pictures, television, social networking, online casual entertainment and music (Activision Blizzard 2013 SEC Form 10-K/A Amended Annual Report).”
What does Activision see as their primary competition? Activision Blizzard, Inc. believes the primary competitive factors in the interactive entertainment industry include: “product features, game quality, and playability; brand name recognition; compatibility of products with popular platforms; access to distribution channels; online capability and functionality; ease of use; price; marketing support; and quality of customer service. (Activision Blizzard – 2013 SEC Form 10-K/A Amended Annual Report).” What strategies and specific activities is Activision considering to compete with others? Expanded product development – Activision Blizzard, Inc. is “creating a publishing arm that will bring third-party mobile games to market. Through the program, it will assist independent game makers with funding, development, distribution and promotion of their titles across both iPhone and iOS. The company is collaborating with Flurry to help with this transition (Duryee, Tricia. "Activision Starting to Take the Plastic Wrap off Its Mobile...
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