Activision Vivendi Merger Interview with Blizzard`s President and…

Rather unusually for a weekend there was a big announcement from both Vivendi and Activision as the two companies merge to form Activision Blizzard. We had the opportunity to talk to Blizzard’s President and CEO, Mike Morhaime about the merger and what it means for both Blizzard and Activision.Thanks for taking time out to discuss today’s big announcement. So, can you tell us about this merger.Let me give you the highpoints. Earlier today Vivendi Games and Activision announced they are going to be combining their businesses, and of course Blizzard Entertainment, is part of Vivendi Games. Vivendi will be taking a majority stake in the combined business, which will be renamed to Activision Blizzard. As far as Blizzard Entertainment is concerned, I will continue to run the company just like I have for the past several years. I’ll be President and CEO of Blizzard Entertainment, reporting up to Bobby Kotick, who will be CEO of Activision Blizzard.The combination of these two businesses you’ll see is very complementary . Activision has a really strong track record in the console business. They are very strong in North America especially, and also in Europe. Blizzard, of course is very strong, number one in PC online games with World of Warcraft, the largest subscription game in the world with 9.3 million subscribers. We also have the largest penetration of any western publisher in Asia, including China, Korea, and Taiwan. So when you look at the two businesses, we’re very complementary and the combination will basically yield the world’s largest and most profitable video game publisher, with diversification across all platforms, all categories, and all geographies. I think that it’s great for Blizzard, we think it’s great for our players and we think it’s great for the industry because competition is good.Can you tell us little bit more about how this deal came about?Originally Bobby Kotick, the CEO of Activision, got in touch with Bruce Hack, CEO of Vivendi Games, earlier this year just to talk about whether there were any interesting things the two companies could do together. It became clear how complementary the two businesses are. And that interested Vivendi, who have been very supportive of their games division, wanting to expand it into a leadership role This was an opportunity for Activision, Blizzard, and Vivendi to take the next step in the evolution of our companies.Over the last few years there’s been all kinds of rumours about EA and Microsoft showing an interest in Vivendi’s game division. What’s so different this time?The biggest difference is that these two businesses are just so complementary. I can also tell you that it just feels like a very good cultural fit. I spent a lot of time talking to Bobby about our philosophies at Blizzard, the quality, our philosophies on development, publishing and he shares many of these philosophies. There’s a great deal of mutual respect between our two companies and so I think that’s really important. We’re excited to do this type of deal.I think also from the Vivendi and Blizzard perspective, this is an opportunity to really unlock the value that has been created at Blizzard, which I don’t think has been recognised in the value of Vivendi stock because we’re such a small part of this very large company involved with things other than games. This puts us in a better position inside the largest game publisher but really helps unlock that value and expose it to shareholders so they can see what we’re doing at Blizzard, which is really impressive.