Activision Didn't Think Blizzard Was Worth $7 Million in 1995

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Activision Didn't Think Blizzard Was Worth $7 Million in 1995

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In the distant mists of 1995, Bobby Kotick thought a company was crazy when it acquired the small development studio Blizzard for $7 million. In 2007, he paid $7 billion. Whoops.

When it comes to pure financial solvency, there are very few developers in the business that have as much guaranteed revenue as popular PC game maker Blizzard. Infinity Ward has the ridiculously popular Modern Warfare 2, Nintendo has its own stable of money-printing machines and franchises, but Blizzard has games that are still on bestseller lists despite being a decade old - and of course, Blizzard has WoW.

In 2007, Activision merged with Blizzard parent Vivendi Games to form Activision-Blizzard, a merger worth a whopping $18 billion. In the course of that merger, Activision ended up paying $7 billion for the World of Warcraft studio, a fact which prompted Activision CEO Bobby Kotick to relate an anecdote about how things could have gone differently between the studios to Game Informer.

In 1995, said Kotick, he had been having a meal with Davidson & Associates during which it came up that the firm had purchased fledgling developer Blizzard for $7 million. The businessman in Kotick was, frankly, baffled: "That year Activision probably had 60 million in revenues. They said they paid seven million dollars for Blizzard. I'm like 'Are you out of your minds? They're like a contract developer! They have Warcraft but what else do they have? You paid SEVEN million! That's insane!'"

Twelve years later, Kotick's company would pay a thousand times that for the PC developer. "I was talking to [Blizzard founder] Mike Morhaime the other day and I said, 'You know, I could have bought you for seven million and instead it was seven billion.' He said, 'Yeah, could you imagine if I had just held out for the seven billion instead of the seven million?'"

I can imagine the situation would be frustrating in a rather ha-ha-funny-in-hindsight way for both Kotick and Morhaime, though for decidedly different reasons. But it's something very interesting to consider - how would the gaming landscape have changed if Activision had been the one to acquire Blizzard in 1995 for that (relative) chump change?

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We might actually have Starcraft 2 by now?

With LAN.

But no mods.

And we'd have Space CoD by now.

Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

John Funk:
But it's something very interesting to consider - how would the gaming landscape have changed if Activision had been the one to acquire Blizzard in 1995 for that (relative) chump change?

Exactly the same I think. Activision likes money, WoW and Warcraft and Starcraft make money. Those games would probably still be made, although I couldn't vouch for their quality.

Well, he didn't have any idea of what was going to happen. It is pretty funny, nonetheless.

always nice to hear one of those "rejected the Beatles" story's.

Blizzard would have never grown to the size it is today if Activision acquired it in 1995. Well, Blizzard's fanbase wouldn't have.

Just goes to prove, with time, money...and a game which everyone seems to fall in love with...any company can go from nothing to a household name!

What would Blizzard have been worth if they didn't create World of Warcraft?

Easy, we'd be on Shanghai 15 and Blizzard would be known worldwide as creatively bankrupt hack developers, Starcraft never gets made, why would an adventure and sports game developer make an RTS? It's not what we pay them for. WoW never gets made, it's too big a risk and the competition (FF11, SWG) is too well established and not profitable enough to justify the cost...

It's only their massive success that gives them relative freedom from Activision, if that hadn't been there they'd have been crushed and talent stripped within five years.

Onyx Oblivion:
What would Blizzard have been worth if they didn't create World of Warcraft?

A bunch of devs. trying to rip off anything they can find

Blizzard made hits long before WoW, and will continue to.

Paragon Fury:
We might actually have Starcraft 2 by now?

With LAN.

But no mods.

And we'd have Space CoD by now.

No LAN, no mods, and the PC multiplayer would be ganked, in favour of the console port's method. Also, WoW would have likely failed due to Activison deciding it wasn't worth updating the code or what not.

And just think, in another seven years they'll be paying 7 trillion for Blizzard.

Though I suppose I should point out that Blizzard probably wouldn't have been able to support it's insanely long development time if it weren't for the original starcraft. Without that hit no publisher in their right mind would let them take so much time.

If Activision DID buy Blizzard back then, they would have rushed and ruined WoW, SCII and then given up half their projects, and then enter into a legal battle with anyone who finished them.

Of course Blizzard being absorbed into the conglomeration that is Activision back then could have ruined them thus nothing would have happened.

To be honest, in 1995, they weren't worth 7,000,000. Remember such classics as Lord of the Rings: Vol. 1, Battle Chess 1 and 2, Blackthorne, Dvorak on Typing, Rock and Roll Racing, and the Lost Vikings? In 1995, they made Justice League Task Force, arguably the worst fighter ever made. Warcraft 1 barely came out and Warcraft 2 was also getting released. In 1995, none of the franchises that made Blizzard fanboys were made. No Diablo, No Starcraft, no Warcraft 3. There was certainly no WoW, something that no one could have predicted.

Now it might be nice to kick people for not having forsight, but it is not fair. You cannot predict the future. All you can do is make assertions based on the recent past.

That's a nice article and all, but all I want to do is go and see that statue.

Good, I hope it hurts Bobby and makes him cry at night

Activision will be happy when Starcraft 2, Diablo 3, and Cataclysum comes out, there will be no more complaints.

Suck it, Bob!

Does your money love you?!
No, you spent it on Blizzard!

He, he, he.

whyarecarrots:
Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

Trust me... No, you're just being a gamer, hating the man who wants to charge you more.

And in 1995 Apogee/3D Realms had a stable of games, was a fairly big publisher and was set to release Duke 3D in Jan '96. That company will be a cash machine, for sure!

Ocelot GT:
If Activision DID buy Blizzard back then, they would have rushed and ruined WoW, SCII and then given up half their projects, and then enter into a legal battle with anyone who finished them.

We're talking about Activision, not Bethesda (har har).

I have actually gained a respect for Activision and ol' Bobby after reading that in Game Informer. He's not really the devil everyone claims him to be (But, then again, just about everyone is willing to crucify a publisher/developer if they don't release a screenshot, to say the least).

sirdanrhodes:

whyarecarrots:
Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

Trust me... No, you're just being a gamer, hating the man who wants to charge you more.

I thought being a gamer was about actually playing games, not bitching about one person in an industry that has millions of people doing millions of things.

Haha well I'm glad they weren't bought then, who knows. Maybe the quality of Blizzards games wouldn't be as good as they are now. On the other hand they could also have been better :P

Excellent Foresight there Bobby.

JimmyBassatti:

I have actually gained a respect for Activision and ol' Bobby after reading that in Game Informer. He's not really the devil everyone claims him to be (But, then again, just about everyone is willing to crucify a publisher/developer if they don't release a screenshot, to say the least).

sirdanrhodes:

whyarecarrots:
Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

Trust me... No, you're just being a gamer, hating the man who wants to charge you more.

I thought being a gamer was about actually playing games, not bitching about one person in an industry that has millions of people doing millions of things.

It is, but you have to draw the line on how much money you are going to give to the hobby. Bobby breaks the limit.

whyarecarrots:
Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

No, it means you're human.

sirdanrhodes:

JimmyBassatti:

I have actually gained a respect for Activision and ol' Bobby after reading that in Game Informer. He's not really the devil everyone claims him to be (But, then again, just about everyone is willing to crucify a publisher/developer if they don't release a screenshot, to say the least).

sirdanrhodes:

whyarecarrots:
Is it bad that I'm just enjoying the thought of Activision and Bobby Kotick getting something so monumentally wrong?

Trust me... No, you're just being a gamer, hating the man who wants to charge you more.

I thought being a gamer was about actually playing games, not bitching about one person in an industry that has millions of people doing millions of things.

It is, but you have to draw the line on how much money you are going to give to the hobby. Bobby breaks the limit.

Yes, it is redunkulous. What else is redunkulous? The people that want to burn him at the stake for all he has done. Yeah, he wants a lot of money, but can't we draw the line when we get a meme caused by him? Bobby is just human, and he happens to be greedy, like every other human. He just happens to be more greedy than a regular person. But Steve Jobs, don't get me started on him...

just warms my heart seeing Bobby Kotick fucking up.

Bobby Kotick once again making us ask "How the fuck do you still have a job?"

malestrithe:
To be honest, in 1995, they weren't worth 7,000,000. Remember such classics as Lord of the Rings: Vol. 1, Battle Chess 1 and 2, Blackthorne, Dvorak on Typing, Rock and Roll Racing, and the Lost Vikings? In 1995, they made Justice League Task Force, arguably the worst fighter ever made. Warcraft 1 barely came out and Warcraft 2 was also getting released. In 1995, none of the franchises that made Blizzard fanboys were made. No Diablo, No Starcraft, no Warcraft 3. There was certainly no WoW, something that no one could have predicted.

Now it might be nice to kick people for not having forsight, but it is not fair. You cannot predict the future. All you can do is make assertions based on the recent past.

True. I know people love to hate Kotick and Activision but I wouldn't have bought Blizzard back in 19995 either.

Paragon Fury:
We might actually have Starcraft 2 by now?

With LAN.

But no mods.

And we'd have Space CoD by now.

Space CoD would be very interesting to play if they did it right..

I blame Starcraft 2's long development time over the incite that the developers are playing too much WoW. Sure it's nice to ride the money train every once in a while, but you gotta remember to jump off before it derails and crashes into a wall.

John Funk:
...how would the gaming landscape have changed if Activision had been the one to acquire Blizzard in 1995 for that (relative) chump change?

Simple: There wouldn't be a blizzard.

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