American video game publisher
Activision Publishing, Inc. is an American video game publisher based in Santa Monica, California. It serves as💶 the publishing business for its parent company, Activision Blizzard, and consists of several subsidiary studios. Activision is one of the💶 largest third-party video game publishers in the world and was the top United States publisher in 2024.[5]
The company was founded💶 as Activision, Inc. on October 1, 1979 in Sunnyvale, California, by former Atari game developers upset at their treatment by💶 Atari in order to develop their own games for the popular Atari 2600 home video game console. Activision was the💶 first independent, third-party, console video game developer. The video game crash of 1983, in part created by too many new💶 companies trying to follow in Activision's footsteps without the experience of Activision's founders, hurt Activision's position in console games and💶 forced the company to diversify into games for home computers, including the acquisition of Infocom. After a management shift, with💶 CEO Jim Levy replaced by Bruce Davis, the company renamed itself to Mediagenic and branched out into business software applications.💶 Mediagenic quickly fell into debt, and the company was bought for around US$500,000 by Bobby Kotick and a small group💶 of investors around 1991.
Kotick drastically revamped and restructured the company to get it out of debt: dismissing most of its💶 staff, moving the company to Los Angeles, and reverting to the Activision name. Building on existing assets, the Kotick-led Activision💶 pursued more publishing opportunities and, after recovering from its former financial troubles, started acquiring numerous studios and various types of💶 intellectual property over the 1990s and 2000s, among these being the Call of Duty and Guitar Hero series. A holding💶 company was formed as Activision's parent company to manage both its internal and acquired studios. In 2008, this holding company💶 merged with Vivendi Games (the parent company of Blizzard Entertainment) and formed Activision Blizzard, with Kotick as its CEO. Within💶 this structure, Activision manages numerous third-party studios and publishes all games besides those created by Blizzard. In October 2024, Microsoft💶 acquired parent company Activision Blizzard, maintaining that the company will continue to operate as a separate business. While part of💶 the larger Microsoft Gaming division, Activision retains its function as the publisher of games developed by their studios.
History [ edit💶 ]
Founding (1979) [ edit ]
Co-founder David Crane in 2013
In 1976, Warner Communications bought Atari, Inc. from Nolan Bushnell to help💶 accelerate the Atari Video Computer System (Atari VCS or later the Atari 2600) to market by 1977. That same year,💶 Atari began hiring programmers to create games for the system. Prior to Warner's acquisition, the company did not award bonus💶 pay to programmers who worked on profitable games,[6][7] nor credit the programmers publicly, to prevent them from being recruited by💶 rival game companies.[8] Warner Communication's management style was also different from Bushnell's. According to developer John Dunn, Warner management treated💶 developers as engineers rather than creative staff, creating conflicts with staff.[9] Atari's CEO Ray Kassar, named to that position following💶 Warner's acquisition in 1978, was committed to keeping production costs minimal for Warner, according to David Crane, one of Atari's💶 programmers.[10]
In early 1979, Atari's marketing department circulated a memo listing the best-selling cartridges from the previous year to help guide💶 game ideas.[10] Crane noted that the games he was fully responsible for had brought in overR$20 million for the company💶 but he was still only receiving aR$20,000 salary.[11] Out of a development staff of thirty-five, four programmers (Crane, Larry Kaplan,💶 Alan Miller and Bob Whitehead), had produced games that had accounted for 60% of Atari's sales.[10]
Crane, Kaplan, Miller, and Whitehead💶 became vocal about the lack of recognition within the company and became known as the "Gang of Four".[11] The group💶 met with Kassar in May 1979 to demand that the company treat developers as record labels treated musicians, with royalties💶 and their names on game boxes. Kaplan, who called the others "the best designers for the [2600] in the world",💶 recalled that Kassar called the four men "towel designers" and claimed that "anybody can do a cartridge".[12]
The four made the💶 decision to soon leave Atari and start their own business, but were not sure how to go about it.[11] In💶 1979, the concept of third-party developers did not exist,[13] as software for video game consoles were published exclusively by makers💶 of the systems for which the games were designed;[14] thus the common thinking was that to make console games, one💶 needed to make a console first.[10] The four decided to create their own independent game development company. They were directed💶 by their attorney to Jim Levy, who was at the time raising venture capital to get into the software business💶 for early home computers. Levy listened to their plans, agreed with its direction, and helped the four to secure aboutR$1💶 million in capital from Sutter Hill Ventures.[11] They also checked with legal counsel on their plans to develop games for💶 the Atari VCS, and included litigation fees in their capital investment.[10]
By August, Crane and Miller had left Atari, with Whitehead💶 joining them shortly after.[12] Kaplan had also quit Atari in August, but initially decided not to join as he did💶 not like the starting business plan; he came back later to join Activision that December.[15] Activision was formally founded on💶 October 1, 1979, with Levy serving as CEO. The company was initially named "Computer Arts, Inc." while they considered a💶 better title. The founders had thought of the name VSync, Inc., but feared that the public would not understand or💶 know how to say it. Levy suggested combining "active" and "television" to come up with Activision.[16][17]
Early years (1980–1982) [ edit💶 ]
Activision began working out of Crane's garage in the latter half of 1979, each programmer developing their own game that💶 was planned for release in mid-1980, Dragster, Fishing Derby, Checkers, and Boxing.[10] The four's knowledge of the Atari 2600, as💶 well as software tricks for the system, helped them make their own games visually distinct from Atari-produced games.[11] To further💶 distinguish themselves, Activision's boxes were brightly colored and featured an in-game screenshot on the back cover.[11] Instruction manuals for games💶 devoted at least one page to credit the developer. Additionally, for nearly all of Activision's games through 1983, the instruction💶 manuals included instructions for sending the company a photograph of a player's high scores to receive a patch in return.[18]
Ahead💶 of the release of the first four games, Activision obtained space at the mid-year 1980 Consumer Electronics Show to showcase💶 their titles, and quickly obtained favorable press.[10] The attention afforded to Activision worried Atari, as the four's departure had already💶 created a major dent in their development staff.[11] Atari initially tried to tarnish Activision's reputation by using industry press at💶 CES to label those that took trade secrets as "evil, terrible people", according to Crane, and then later threatened to💶 refuse to sell Atari games to retailers that also carried these Activision titles.[10] By the end of 1980, Atari filed💶 a formal lawsuit against Activision to try to stop the company, claiming the four had stolen trade secrets and violated💶 non-disclosure agreements.[10] The lawsuit was settled by 1982, with Activision agreeing to pay royalties to Atari but otherwise legitimizing the💶 third-party development model.[11][19] In 2003, Activision's founders were given the Game Developers Choice "First Penguin" award, reflecting their being the💶 first successful third-party developer in the video game industry.[20]
Following the first round of releases, each of the founders developed their💶 own titles, about once a year, over the first few years of the company.[11] While their 1980 games were modest💶 hits, one of the company's first successful games was Kaboom!, released in 1981, which was Activision's first game to sell💶 over a million units.[10] Activision's breakout title was 1982's Pitfall!, created by Crane. More than four million copies of the💶 game were sold.[21] Near the end of 1982, Kaplan left Activision to work on the development of the Amiga personal💶 computer as he wanted to be more involved in hardware development.[22][10]
Total sales for Activision were estimated atR$157 million and revenues💶 atR$60 million ahead of its June 1983 initial public offering; at this point Activision had around 60 employees.[11][10] Danny Goodman💶 stated in Creative Computing Video & Arcade Games in 1983, "I doubt that there is an active [Atari 2600] owner💶 who doesn't have at least one Activision cartridge in his library".[23] The company completed its public offering in June 1983💶 on NASDAQ under the stock ticker AVSN.[11][24]
The video game market crash (1983–1988) [ edit ]
The success of Activision, alongside the💶 popularity of the Atari 2600, led to many more home consoles third-party developers as well as other home consoles. Activision💶 produced some of its Atari games for the Intellivision and ColecoVision consoles, among other platforms.[25] However, several new third-party developers💶 also arose, attempting to follow the approach Activision had used but without the experience they had; according to Crane, several💶 of these companies were founded with venture capital and hired programmers with little game design experience off the street, mass-publishing💶 whatever product the developers had made. This was a contributing factor to the video game crash of 1983.[11]
For Activision, while💶 they survived the crash, they felt its effects in the following years. These third-party developers folded, leaving warehouses full of💶 unsold games, which savvy retailers purchased and sold at a mass discount ($5 compared to Activision'sR$40 manufacturer's suggested retail price).💶 While there was still a demand for Activision games, uneducated consumers were more drawn to the heavily discounted titles instead,💶 reducing their income.[11] Their quarterly revenue dropped fromR$50 million in mid-1983 to aboutR$6–7 million by the end of 1984, according💶 to Levy, and were forced to lay off staff, going from about 400 employees to 95 in that period.[26] Because💶 of this, Activision decided that they needed to diversify their games onto home computers such as the Commodore 64, Apple,💶 and Atari 8-bit family to avoid completely going out of business like other third-party developers.[11] There still was a drain💶 of talent through 1985 from the crash. Miller and Whitehead left in 1984 due to the large devaluation of their💶 stock and went to form Accolade.[11][22]
With the video game crash making console game development a risky proposition, the company focused💶 on developing for home computers with games like Little Computer People and Hacker, while Levy tried to keep expenditures in💶 check as they recovered.[11] Looking to expand further, Activision acquired, through a corporate merger, the struggling text adventure pioneer Infocom💶 in June 1986. This acquisition was spearheaded by Levy, who was a big fan of Infocom's titles and felt the💶 company was in a similar position as Activision.[22] About six months after the "Infocom Wedding", Activision's board decided to replace💶 Levy with Bruce Davis. Davis was against the purchase of Infocom from the start and was heavy-handed in its management,[27]💶 and even attempted to seek a lawsuit to recover their purchase from Infocom's shareholders.[11] Crane also found Davis difficult to💶 work with and was concerned with how Davis managed the closure of Imagic, one of the third-party development studios formed💶 in Activision's success in 1981.[11] Crane left Activision in 1986 and helped Garry Kitchen found Absolute Entertainment.[11] In late 1986,💶 Activision adopted the Electric Dreams brand, usually used for British software, for titles outside of English for the American market.[28]
Mediagenic💶 (1988–1991) [ edit ]
Mediagenic's former headquarters in Menlo Park, circa 2024[29]
In 1988, Activision began involvement in software besides video games,💶 such as business applications. As a result, Activision changed its corporate name to Mediagenic to better represent all of its💶 activities.[30][11]
Mediagenic consisted of four groups:
In 1989, after several years of losses, Activision closed down the Infocom studios, extending to only💶 11 of the 26 employees an offer to relocate to Activision's Silicon Valley headquarters. Five of them accepted this offer.[27]
Notably💶 during this time, Mediagenic was known to have worked on the early version of a football game that would be💶 the basis for Joe Montana Football. Sega of America's Michael Katz had been able to get Sega to pay Mediagenic💶 around early 1990 to develop this into the branded version after securing the rights to Joe Montana's name, but was💶 unaware of internal troubles that had been going on within the company, which had left the state of the game💶 mostly unfinished. Katz and Sega were forced to take the incomplete game to Electronic Arts, which had been developing its💶 own John Madden Football series for personal computers, to complete the game.[31]
During this period Mediagenic, via Activision, secured the rights💶 to distribute games from Cyan Worlds. The first game published by Activision from Cyan was The Manhole, on CD-ROM for💶 personal computers, the first major game distributed in this format.[32][33][10]
Purchase by Bobby Kotick (1991–1997) [ edit ]
Davis' management of Mediagenic💶 failed to produce a profitable company; in 1991, Mediagenic reported a loss ofR$26.8 million on onlyR$28.8 million of revenue and💶 had overR$60 million in debt.[11][34] Cyan severed their contract with Activision, and turned to Broderbund for publishing, including what would💶 become one of the most significant computer games of the 1990s, Myst.[34]
Bobby Kotick
Bobby Kotick had become interested in the value💶 of the video game industry following the crash, and he and three other investors worked to buy Commodore International in💶 an effort to gain access to the Amiga line of personal computers. After failing to complete purchase, the group bought💶 a company that licensed Nintendo characters, and through Nintendo was directed to the failing Mediagenic.[35] Kotick was drawn to buy💶 out Mediagenic not for its current offerings but for the Activision name, given its past successes with Pitfall!, with hopes💶 to restore Activision to its former glory.[36] Crane said that Kotick has recognized the Activision brand name could be valued💶 aroundR$50 million and rather than start a new company and spend that amount to obtain the same reputation, he saw💶 the opportunity to buy the failing Mediagenic at a bargain price and gain Activision's reputation with minimal cost.[10] Kotick and💶 additional investors bought Mediagenic for approximatelyR$500,000 in 1991. This group of investors included real estate businessman Steve Wynn and Philips💶 Electronics.[37][35]
Kotick became CEO of Mediagenic on its purchase and made several immediate changes: He let go of all but 8💶 of the companies' 150 employees, performed a full restructuring of the company, developed a bankruptcy restructuring plan, and reincorporated the💶 company in Los Angeles, California.[19] In the bankruptcy plan, Kotick recognized that Mediagenic still had valuable assets, which included the💶 Infocom library as well as its authoring tools to make games, Activision's distribution network, and licenses to develop on Nintendo💶 and Sega home consoles.[34] Kotick offset some debt by giving stock in the company to its distributors as to keep💶 them vested in the company's success.[34] Kotick also had the company reissue several of its past console and Infocom titles💶 as compilations for personal computers. Kotick had also recognized the value of the Zork property from Infocom, and had the💶 company develop a sequel, Return to Zork. Combined, these steps allowed Mediagenic to fulfill on the bankruptcy plan, and by💶 the end of 1992, Kotick renamed Mediagenic to the original Activision name.[34] The new Activision went public in October 1993,💶 raising aboutR$40 million,[19] and was listed on NASDAQ under its new ticker symbol ATVI.[37]
By 1995, Kotick's approach had met one💶 promise he made to investors: that he would give them four years of 50% growth in revenues while remaining break-even.💶 Reaching this goal, Kotick then set Activision on his second promise to investors, to develop high-demand games and make the💶 company profitable by 1997.[34]
Activision published the first-person perspective MechWarrior in 1989, based on FASA's pen-and-paper game BattleTech. A sequel, MechWarrior💶 2, was released in 1995 after two years of delays and internal struggles, prompting FASA not to renew their licensing💶 deal with Activision. To counter, Activision released several more games bearing the MechWarrior 2 name, which did not violate their💶 licensing agreement. These included NetMech, MechWarrior 2: Ghost Bear's Legacy, and MechWarrior 2: Mercenaries. The entire MechWarrior 2 game series💶 accounted for more than US$70 million in sales.
Activision procured the license to another pen-and-paper-based war game, Heavy Gear, in 1997.💶 The video game version was well received by critics, with an 81.46% average rating on GameRankings and being considered the💶 best game of the genre at the time by GameSpot. The Mechwarrior 2 engine was also used in other Activision💶 games, including 1997's Interstate '76 and 1998's Battlezone.
Growth and acquisitions (1997–2008) [ edit ]
With several of its own successfully developed💶 games helping to turn a profit, Kotick led Activision to start seeking acquisitions of video game development studios, guided by💶 market surveys to determine what areas of content to focus on.[35] It is estimated that between 1997 and 2008, Activision💶 made 25 acquisitions, several for undisclosed amounts. Several of these came prior to 2001, in the midst of the Dot-com💶 bubble, enabling the company to acquire studios at a lower valuation.[35] On June 16, 2000, Activision reorganized as a holding💶 company, Activision Holdings, to manage Activision and its subsidiaries more effectively.[38] Activision changed its corporate name from "Activision, Inc." to💶 "Activision Publishing, Inc.", while Activision Holdings took Activision's former "Activision, Inc." name.[38] Activision Publishing became a wholly owned subsidiary of💶 Activision, which in turn became the publicly traded company, with all outstanding shares of capital stock converted.[38][39]
Some of the key💶 acquisitions and investments made by Activision in this period include:
Merger with Vivendi Games (2008) [ edit ]
While Activision was highly💶 successful with its range of developers and successful series, Kotick was concerned that they did not have a title for💶 the growing massively multiplayer online market, which presented the opportunity for continued revenues from subscription models and microtransactions instead of💶 the revenue from a single sale. Around 2006, Kotick contacted Jean-Bernard Lévy, the new CEO of Vivendi, a French media💶 conglomerate. Vivendi had a games division, Vivendi Games, that was struggling to be viable at the time, but its principal💶 feature was that it owned Blizzard Entertainment and its highly successful World of Warcraft game, which was drawing inR$1.1 billion💶 a year in subscription fees. Vivendi Games also owned Sierra Entertainment.[19]
Lévy recognized Kotick wanted control of World of Warcraft, and💶 offered to allow the companies to merge, but only if Lévy held the majority shares in the merged group, forcing💶 Kotick to cede control. Kotick fretted about this decision for a while, according to friends and investors. During this time💶 in 2006–2007, some of Activision's former successful properties began to wane, such as Tony Hawk's, so Activision bought RedOctane, the💶 publisher of the Guitar Hero franchise.[19] Kotick met with Blizzard's president Mike Morhaime, and learned that Blizzard also had a💶 successful inroad into getting their games into China, a potentially lucrative market. Given this potential opportunity, Kotick agreed to the💶 merger.[19]
Activision's board signed on to the merger by December 2007.[50] The merger was completed in July 2008. The new company💶 was called Activision Blizzard and was headed by Kotick, while Vivendi maintained a 52% share in the company.[19][51] The new💶 company was estimated to be worth US$18.9 billion, ahead of Electronic Arts, which was valued at US$14.1 billion.[52]
Post-merger developments (2009–present)💶 [ edit ]
Activision Publishing remains a subsidiary of Activision Blizzard following the merger, and is responsible for developing, producing, and💶 distributing games from its internal and subsidiary studios. Eric Hirshberg was announced as Activision Publishing's CEO in 2010.[39]
Activision Publishing established💶 Sledgehammer Games in November 2009. Formed earlier in 2009 by Glen Schofield and Michael Condrey, former Visceral Games leads that💶 had worked on Dead Space, Sledgehammer intended to develop a Call of Duty spin-off title fashioned after the gameplay in💶 Dead Space. However, in early 2010, legal issues between Infinity Ward and Activision Blizzard led to several members of Infinity💶 Ward leaving, and Activision assigned Sledgehammer to assist Infinity Ward in the next major Call of Duty title, Modern Warfare💶 3.[53] Since then, Sledgehammer, Infinity Ward, and Treyarch share development duties for the flagship series, with support from Raven and💶 other studios as necessary.
In February 2010, Activision Blizzard reported significant losses in revenue stemming from a slow down in Guitar💶 Hero sales and from its more casual games. Subsequently, Activision Publishing shuttered Red Octane, Luxoflux and Underground Development as well💶 as laid off about 25% of the staff at Neversoft.[54][55] Within the same year, Activision shuttered Budcat Creations in November💶 2010, and Bizarre Creations in February 2011.[56][57]
Hirshberg left the CEO position in March 2024.[58]
Into the 2024s, Activision put more focus💶 on the Call of Duty franchise, including the release of the free-to-play Call of Duty: Warzone in 2024. By April💶 2024, the company had assigned all of its internal studios to work on some part of the Call of Duty💶 franchise.[59] This includes a new studio, Activision Mobile, devoted to the Call of Duty Mobile title as reported in August💶 2024.[60][61]
In 2024, while all their employees were working remotely during the COVID-19 pandemic, Activision and its parent Activision Blizzard vacated💶 their longtime headquarters building in Santa Monica and ended their lease with Boston Properties. In September 2024, they subleased a💶 much smaller office space in Santa Monica at the Pen Factory (a former Paper Mate factory) from Kite Pharma, which💶 had leased the space from Lincoln Property Company.[62]
With the acquisition of Activision Blizzard by Microsoft in October 2024, Activision Blizzard💶 as a whole, including the Activision Publishing subdivision, became a separate division under the Microsoft Gaming arm of Microsoft.[63]
Studios [💶 edit ]
Former studios [ edit ]
Notable games published [ edit ]
See also [ edit ]
