Activision boss Bobby Kotick doesn’t see Activision moving into the social or mobile markets in any capacity in the foreseeable future. Speaking at the Reuters Global Media Summit yesterday, Kotick says that there is certain to be expansion in the near future for the market, but in the long run Activision just does not see itself in the mobile or social games spaces.
“The place where you have the opportunities for growth is within the communities of franchises we control,” said Kotick. “We don’t view the App Store as a really big opportunity for dedicated games. It’s a different question assessing [social games] as a business opportunity. Right now we don’t see an opportunity for us to participate in that market.”
This comes in stark contrast to EA’s statements at the same summit, in which EA CEO John Riccitiello stated that the company is heavily invested in the mobile and social markets.
[Via Reuters]
4 Comments
December 1, 2010
"We don't believe in investing in the highest growth segments of the market," said Bobby Kotick. "We prefer to place our bets in the part of the industry that has shown negative sales growth for the past two years."
Usually you pay at least a little attention to the parts of the market that are growing the fastest. Even if you don't want to get your own dollars invested, at least license your properties to someone who's in those spaces... for brand marketing and some profit-heavy licensing revenue if nothing else. Does Bobby really think he can keep doing CoD sequels forever and sales will only grow? Shouldn't the collapse of music titles have shown him that growth is not forever?
"We're completely happy owning large dinosaurs and feel no need to invest in those pesky little mammals," said Kotick. "Oh, look at the pretty light in the sky... I wonder what that means?"
December 2, 2010
@ Steve
Uh, I think you're missing the point. ATVI is invested in these areas, they just choose not to make it a primary focus. Console games are not getting overtaken by mobile anytime soon, and he knows that.
If you consider console games to be dinos, then you are truly bleeding edge, but I don't want you investing my money.
December 2, 2010
Daniel, he didn't say anything about ATVI investing in those areas... his remarks indicated they didn't want to be anywhere near those areas. Which seems like a great way to get blindsided as the markets continue to change. Of course he should still make money from the console space as long as he can; but normally a CEO should look at high-growth segments of a market and strategize a way to profit from that. It's also not a good sign for the long term when the segment you're in is showing negative growth, and other segments that you decide to ignore are the ones showing strong positive growth. Yes, the size difference is great right now... but that can change rapidly.
I found Bobby's comments lacking in even basic PR knowledge... at least say something like "We continue to examine those segments for opportunities that make sense for us." rather than "We don't want to be anywhere near a high-growth market, thanks." The second may be a more truthful statement of corporate policy, but it's certainly not going to bring in more investors eager to buy stocks and run up the stock price. Which is certainly something investors should care about.
December 3, 2010
@ Steven:
If you were an investor in ATVI, you would know (or should know) that they are invested in those areas, and his comment is very clear with the word "dedicated". In other words, they don't see an immediate need to create new ips for the app store, which I am 100% in agreement with.
You're wrong that they are ignoring this area, and you are also wrong that most investors would be concerned about this. I'm way less interested in that than their warchest, which is the largest by far within the industry.