Geographies of Transnational Corporations Paper

I. Origin: Activision Blizzard Inc. is a “worldwide online, PC, console handheld and mobile game publisher” (Activisionblizzard.com/About-Us). Activision Blizzard Inc. ranks among the top game developers and distributors in the ever increasing world market of entertainment software. With top titles including “Call of Duty® as well as Spider-Man™, X-Men™, James Bond™ and TRANSFORMERS™, leading franchises such as Spyro™ and Blizzard Entertainment's® StarCraft®, Diablo®, and Warcraft® franchises including the global #1 subscription-based massively multi-player online role-playing game, World of Warcraft®” (Activisionblizzard.com/About-Us), Activision Blizzard has become one of the more well-known publishers in the world. Activision Blizzard Inc. maintains operations on four continents while providing coverage for online games throughout the entire connected world. The original company, Activision, encompassed by the holding company known as Activision Blizzard was founded in October 1979 in, Northern California, as the “first independent developer and distributor of entertainment software.” (Timeline) Activision was founded by disgruntled programmers that were not being recognized or appropriately compensated by Atari for their hand in the game creation that was accounting for millions of dollars of annual revenue for the company. David Crane, Alan Miller, Larry Kaplan and Bob Whitehead were known as the “Gang of Four,” (Fleming, 2012) when they decided to leave Atari and start a new company that produced games for the Atari console instead of becoming independent contractors for Atari. The “Gang of Four,” worked out of David Crane’s apartment, programming a development system for Activision. There first games hit the shelves in 1980 with titles including Dragster, Boxing, Fishing Derby and Checkers. (Fleming, 2012) The influx of imitators into the world of game development after the initial spearheading venture by the “Gang of Four” caused the game creation market to crash in 1983. Activision then began to diversify, branching out into game creation for other console systems as well as the new PC market that was about to explode.

“Before the founding of Activision, game cartridges were only developed by the company who made the game consoles. Activision changed that,” Crane explained. “We were the first ever third-party developer of video game cartridges, and we knew that we were opening up a whole new business. And it wasn’t just a matter of being in the right place at the right time. We built the necessary technologies, fought the lawsuits, and battled through Atari’s attempts to close off the retail channels to our product.” From “The History of Activision” by Jeffery Fleming

The emerging console gaming market was expanding exponentially throughout the 1980’s. Gaming systems were becoming standard household items in modern societies by the end of the decade. Game creation, publishing and distributing was becoming a large and very competitive market. Games were being stocked in various department stores as well as specialty electronic stores. The spread of technology and communication throughout the world was fueling the electronic gaming platforms success, giving companies like Activision the ability to become a household name along with the major gaming/computing systems like Atari and Commodore. Activision’s continued success during the early years of development can be attributed to the talent, and foresight of the founders of the company, the “Gang of Four.”

II. Diffusion/Globalization:
Activision capitalized on its recognition throughout the 1980’s. Going public in 1983 and then acquiring one of its major competitors, Infocom, in 1987. (Funding Universe, Activision History) Activision changed their name to Mediagenic in 1988 and expanded its product line to include business application programs. This name changed caused them to lose a percentage of their well-developed name recognition among the game publishing industry. Mediagenic branched out internationally during that time, opening an office in the middle of the technological hotbed, Japan. (Funding Universe, Activision History) In 1991, Robert Kotick and Brian Kelly bought controlling interest in Mediagenic. They then restructured the company, changed its name back to Activision and relocated the headquarters to Santa Monica CA. By 1998 they had opened offices in France, the UK and Australia.
Throughout the 1990’s, Activision continued to expand into a greater global economic power within the gaming industry. By 1997, revenues had grown to $189.2 million and had acquired Raven Software Corporation, a German marketing firm, CentreSoft Ltd. (UK) and NBG EDV Handels & Verlag GmbH (German). (Funding Universe, Activision History) Activision also began signing deals with various forms of entertainment media to produce games about and in conjunction with television series, movies and comic books. This immersion into every facet of entertainment increased the global spread of this company to the far reaching corners of the modern world. In 2008 Activision merged with Vivendi Games to form the company now known as Activision Blizzard. The mergers total transaction amount was close to $18.9 billion US dollars. (Thang, 2008) This merger made Activision Blizzard the largest 3rd party video game publisher in the world.
With increased sales and expansion the manufacturing and distribution elements of the company began to expand globally also. Manufacturing of hardcopies of games and other merchandise are done by external companies and within their manufacturing and distribution centers in Fresno, California, Birmingham, United Kingdom Burglengenfeld, Germany, Shanghai, China and Venlo, Netherlands. The following is a list of Activision Blizzard’s International Offices:

Corporate Office
Amsterdam, Netherlands Stockley Park, United Kingdom Velizy, France

Sales Office
Amsterdam, Netherlands Buchs, Switzerland Buenos Aires, Argentina Copenhagen, Denmark Legnano, Italy Madrid, Spain Mexico City, Mexico Mississauga, Canada Munich, Germany Oslo, Norway Paris, France Sao Paulo, Brazil Schiphol, Netherlands Shanghai, China Singapore Stockholm, Sweden Sydney, Australia Taipei, Taiwan Velizy, France

Studio
Cork, Ireland Dublin, Ireland Leamington Spa, United Kingdom Liverpool, United Kingdom Quebec City, Canada Seoul, South Korea Shanghai, China Vancouver, Canada

Manufacturing
Distribution
Birmingham, United Kingdom Burglengenfeld, Germany Shanghai, China Venlo, Netherlands

The expansion and acquisition of software, marketing, and other game publishing companies created an enormous transnational corporation bringing gaming innovations to people all around the world. In addition to entertainment, the success of titles such as World of Warcraft, Guitar Hero and the Diablo series also produced 3rd party jobs by way of merchandise, manipulation software, gaming devices, and apparel. The creation of online communities where people from all around the world join together to experience game play together in massive multiplayer online formats helped to spread the connectedness and communication of Activision Blizzards presence around the globe.

III. Ownership and Pay Structure: Activision Blizzard is the holding company for Activision and Blizzard Entertainment. Activision Blizzard, Inc. trades under the ticker: ATVI. Both Activision and Blizzard Entertainment still exist as separate entities publishing games separately from one another. The President and CEO of Activision Blizzard is Robert Kotick. Kotick receives an annual salary of $1,057,350. In 2011, Kotick also received a bonus for $4,471,325, bringing his total annual compensation in 2011 to $5,528,675. In addition to his annual salary and bonus, Kotick’s total value of stock options came to $8,017,074. The average salary at Activision Blizzard is around $75,000. Game testers make around $30,000 per year while management and producers make an average of $61,000 - $70,000 per year. (Careerbliss.com) The Board of Directors of Activision Blizzard is made up of:
Philippe G.H. Capron – (Chairman) former chief financial officer of Vivendi Games
Jean-Yves Charlier – (Director) he is the senior executive vice president of telecom activities for Vivendi Games
Robert J. Corti – (Director) also the chairperson of the audit committee
Frederic R. Crepin – (Director) also the chairperson of the Nominating and Corporate Governance Committee at Activision Blizzard
Jean-Francois Dubos – (Director) also the chairman of Vivendi Games management board
Lucian Grainge – (Director) the chairman and chief executive officer of Universal Music Group
Brian G. Kelly – (Co-Chairman) has served on the board since 1991
Robert A Kotick – (Director; President and CEO) Since 1991
Robert J. Morgado – (Director) chairman of Maroley Media Group
Richard Sarnoff – (Director) senior advisor to Kohlberg Roberts & Co.
Regis Turrini – (Director) also the senior executive vice president of strategy and development of Vivendi Games

IV. Branding/ Advertising: Activision Blizzard uses a variety of different marketing, advertising and branding techniques to stay competitive and stay atop the gaming industry. The creation of fantasy lands, alternate worlds and the power to give the sensation of extra ordinary skills to people is the main ways in which the company continues to stay on top of the gaming world. The creation and marketing of games such as Call of Duty, World of Warcraft and the Diablo series have created a new level of interconnectedness through the massive multiplayer online experience. The name recognition associated with Activision is a key element to the continued success of the company. Celebrity following has been another beneficial aspect of Activision Blizzard’s marketing and branding. Through the means of both professional commercials featuring celebrities like Chuck Norris, Jimmy Kimmel and Mr. T, as well as through social media and word of mouth, Activision Blizzard’s branding and name recognition expands exponentially with every celebrity seen playing or talking about one of the games published by one of their subsidiaries. There is a significant amount of money spent on advertising and marketing for specific games in order to reach the largest, broadest audience with the potential of not only selling units, but also establishing subscriptions and service revenue. The diversity of games produced, published and distributed by Activision Blizzard and its subsidiaries has also been a key component to the immense growth of the company over the course of the last 30 years. Games and online experiences can be marketed to specific groups of people with specific cultural and entertainment identities. The increasing multitude of games and game experiences make the market for games a living and breathing entity that companies like Activision Blizzard have their finger directly on the pulse of. Activision Blizzard is a prime example of a transnational corporation that was created from shift in an industry practice. The level and amount of growth and spread across the globe came about from the desire and needs of the world’s gaming cultures to experience interconnected electronic entertainment. Activision Blizzard has facilitated the tearing down of borders, the compression of time and space, and the evolution of a multinational community of electronic game players. The gaming world knows that Activision was the first to branch out against the old model of internally created electronic gaming. The name has become synonymous with innovation and the true gaming experience. Blizzard Entertainment has set the par for the course in regards to online role playing games. The combination of the two has created an iconic and powerful corporation that has the ability and the following to lead the charge for another new evolution of gaming community development.