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1. Introduction

Activision Blizzard is an American video game developer and publisher who is held by the French Vivendi group. It is the largest game developers and game publishers, and the first third-party game publishers in the world . Activision Blizzard was made by Activision and the U.S. Department of Vivendi, Blizzard Entertainment, on December 2, 2007, and Entertainment in July 9, 2008. The total operating funds is $ 18.9 billion . In November 2009 , Activision Blizzard 's first -person shooter "Call of Duty : Modern Warfare 2" 4.5 million the number of pre-sale , and $ 400 million sales in the first day, what break the highest first day sales in the Guinness World record. Another major business of Activision Blizzard Blizzard Entertainment is a popular online role -playing game "World of Warcraft " and " Warcraft " series. From the market price, Activision Blizzard is the largest independent video game publishers in the world, because before the merger , the Activision is the second largest third-party game producers and publishers, and the EA Inc. is the biggest at that time. After merged, Activision Blizzard is not only more than EA, became the first major third-party publisher of the game , but more than Nintendo, became the first major game production and distribution company .

2. Industry Structure and Global Markets In their market, Activision Blizzard is facing competition, and they have two major competitors. The company exports many kinds of games. Their products are sold over the world, and some of their products have professional games. EA (Electronic Arts, NASDAQ: ERTS, abbreviated EA), is the world's famous interactive entertainment software company, mainly engaged in a variety of electronic games development, publishing and sales. Electronic Arts was founded in 1982, and headquartered in Redwood City, California. As of 2009, Electronic Arts have set up branches or subsidiaries in other cities of the U.S., Canada, UK, Australia, Taiwan, Hong Kong and other countries and regions around the world, The total number of employees is 7320. Take-Two Interactive (NASDAQ: TTWO) is a major U.S. game developer and publisher, it is also arcade games and peripherals distributor. It owns 2K Games, Dassault Systemes, Focus Home Interactive, Siemens PLM Software and Rockstar Games. The company is headquartered in New York and its international headquarters is in Windsor, England. Their development studios are across many places, including San Diego, Vancouver, Toronto and Novato Activision Blizzard company intends to get $ 2.5 billion credit facility on September 4, which will be used to repurchase shares of the French Vivendi group ,major shareholder, to achieve " ransom ." The loan financing includes $ 2.25 billion class B loans, and $ 250 million revolving loan tool. Currently, and Merrill Lynch, JP Morgan Chase Bank has provided loan commitments . According to a regulatory filing shows on August 1 , Activision Blizzard company will issue $ 1 billion of guaranteed bonds, and $ 1.5 billion of non-guaranteed bonds. Documents show that the company, Activision Blizzard, purchases from major shareholders,Vivendi Group, 429,000,000 shares, which $ 1.2 billion in cash , and $ 4.75 billion will be taken to debt financing. Activision Blizzard repurchased shares amounting to $ 5.83 billion , and the price of a share is $13.6. In addition, Activision Blizzard 's CEO and chairman will also use this opportunity to purchase $ 2.34 billion in stock. After the completion of the transaction , Vivendi will no longer be the controlling shareholder of Activision Blizzard , but the group will still hold 8300 shares stock , equity ratio is about 12%.

3. Economics

After the merger that the total value is $ 18.9 billion of the price, Activision Entertainment and Vivendi Games formed Activision Blizzard . Since 2009 until the subsequent 12 months, the company's income was increased a lot , rising from $ 4.3 billion to $ 5 billion , the same period net income also rose from$ 110 million to $ 1.22 billion. Now it is already the world 's largest gaming company , $ 19.51 billion market capitalization exceeds the veteran leader Nintendo game. Activision Blizzard owned " Call of Duty" , "World of Warcraft " and other popular global game , and this year, the stock rose nearly 60% doing well. From the earnings perspective, Activision Blizzard’s value is 16.24 , which is far superior to the competition Electronic Arts 83.29 and Nintendo 187.23 .

Like other companies in the gaming industry , Activision Blizzard 's balance sheet showed assets of the company in good condition, and high operating leverage . Zero debt and $ 460 million in cash made the company's net use of funds rate of 3.06 , higher than other companies 1 to 2 range values. Activision Blizzard 's return on assets and return on equity capital were 9.3 % and 11.1 %, which show the company 's ability to generate revenue for shareholders .

As of July this year, "World of Warcraft " players has reached 7,000,000 , and maintains the Guinness Book of Records as the world's most popular massively multiplayer online role-playing game . With the " World of Warcraft" continues to bring no-cost cash flow for Activision Blizzard , and to provide expanded services for "Call of Duty ", Activision Blizzard has no doubt owned the ability of to produce high-yield game. Because it has a group of young, loyal , strong purchasing power customer base , the company still have great potential for future development .

4. Corporate Philosophy and Organizational Structure

Mission Statement: (Activision) We continue to pursue our mission to be one of the largest, most profitable and well-respected interactive entertainment software companies of the world.
Mission Statement: (Blizzard) Dedicated to created the most epic entertainment experiences.....ever
Lead Responsibly Our products and practices can affect not only our employees and players -- but the industry at large. As one of the world’s leading game companies, we’re committed to making ethical decisions, always keeping our players in mind, and setting a strong example of professionalism and excellence at all times. The leader of Activision Blizzard is Robert Kotick, who has been the CEO of Activision before the merger.
5. Technology/Innovation
Activision Blizzard the world's largest game publisher, launched every year in the past a lot of new games and classic game sequel. It's a lot of development group, has been for the majority of gamers around the world to provide a high quality video games. Unlike some other game makers or general companies as Activision Blizzard's corporate culture makes its employees will be full of passion into every game works in development, because they are in the recruitment, it would not recruit a people who do not play games as their employees in Activision Blizzard, the employees will not be prohibited in the workplace to play the game. In the middle of this year's BlizzCon, Blizzard expectations, announced to the players a lot of new work, such as World of Warcraft 6.0 version of the trailer, a lot of game development programs, as well as World of Warcraft is about to start shooting the film, and many other information.
Activision Blizzard is the creation of their strategic development in the gaming market for game development.
6. Marketing Plan and Analysis The target market is the people who like playing video games. Product: (creating value) World of Warcraft is the most popular online games in the world. Because of its wealth of creative story, beautiful screen, and a variety of features, it has been in motion almost 10 years. Although it likes a lot of online games, it is faced with the loss of players, but it is still creating profits for Activision Blizzard . Warcraft and StarCraft series are the benchmark for real-time strategy game, which had created many shocking record, such as first month sales, annual sales and so on. In a conclusion, these two game series create a large number of loyal players for Activision Blizzard in the game field. Diablo series is rely on Activision Blizzard battle net. The series is a multiplayer online role-playing, which is developed and issued by Activision Blizzard in the 1990s. as a vigorously game of Activision Blizzard for the new generation, the releasing of Diablo III got a new hight of sale at the end of 2012, it had been sold more than 12million. Furthermore, our first-person shooter perspective will hopefully allow other gamers to try the World of Warcraft experience. For example, Halo and Call of Duty players who enjoy the first-person shooter perspective may want to try diving into the world of Blizzard because they thoroughly enjoy first-person shooter perspective. Moreover, we will modernize the medieval theme of World of Warcraft in the new game to create a new target market of players who enjoy a more modern theme. Price: (capturing value) Activision Blizzard sell the past a variety of games at $20, and three optional plan to carry on the game, World of Warcraft, charges, they are one month plan monthly as $ 14.99, 3 month monthly as $ 13.99, 6 month plan monthly as $ 12.99. Because the Call of Duty series customers want to experience the excellent visual effects, interesting story, and superior handling, etc., the series of games price range located in the $ 40 - $ 70 sale price. This price positioning is an agreement between Activision Blizzard and the players, because even if they increase the better graphics or story line, it will not raise prices. Place: (delivering value) Because Activision Blizzard hopes to provide efficient sales methods to enable consumers to enjoy the fun of the game at the first time, so they sold their entity not only in the major retailers who offer software, but also digital version of resources download for their registered members at the same time, which means that many users can stay at home and get the products. Because Activision Blizzard is a global company, the Internet is more conducive to business development and promotion of its business expansion, this method is effective and appropriate,. Promotion: (communicating value)
Activision Blizzard’s two main goals for promotion are: to heavily promote the release of a new World of Warcraft game and to target a new market, which is first person shooter gamers. In order to best reach both target markets, they will predominantly promote through the internet and other computer networking. Promotion will begin months before the release of the new game in order to create anticipation.
The simplest ways to promote their new game to current World of Warcraft gamers is through their website, magazine, forums, and online store. Since Activision Blizzard’s game is more than just a new storyline of World of Warcraft, they will share information about the differences in this game through television advertisements and articles in the website, magazine, and forums. They expect current fans to anticipate new WOW games and will therefore be an easily promotable market. Marketing their new game to first person shooters will be a much bigger challenge. Furthermore, Activision Blizzard will attempt to reach potential consumers who are not currently exposed to Blizzard but are avid gamers.
In order to reach all their target markets, Activision Blizzard will allow a public preview the game. Their website will offer a free downloadable preview of the game in order to experience the first person shooter angle. This preview will also showcase the better graphics, the benefits of first-person shooter, and the new enhancements Activision Blizzard have added to the game. Having a WOW account is not necessary to download the preview because want to be able to reach potential customers as well as current ones. Therefore, Activision Blizzard will not put any limit on who is able to preview the game.
Strengths
• Strong line of successful game franchises that can be expanded.
• Licensing agreements with major companies to produce big-name titles.
• Positioned for continued success from the growth of the subscription-based online gaming industry.
• Mergers and acquisitions add to revenue and expand business to capture new audiences.
Weaknesses
• High product development costs.
• Key revenue drivers are from a smaller number of game franchises.
• High risk in developing new/unproven franchises.
• Seasonal demand can negatively impact quarterly statements.
Opportunities
• New gaming platforms to expand titles (potential creation of own platform).
• Expansion of increased titles to new gaming outlets (iPhone apps, etc.).
• Increase use of interactive peripherals.
• Acquiring other publishing companies with strong titles.
• Potential for movie deals based on hit gaming titles.
• In-game advertisement.
• Expansion into growing international markets.
Threats
Government regulation and ratings association could negatively certain titles.
International regulation may make it difficult to enter/operate in some markets.
Failure of high cost titles
Changing economic conditions that negatively affect consumer spending
Ever-changing platforms increase costs associated with product development.
8. Conclusion and Recommendation
Activision Blizzard (ATVI) has been a favorite holding of mine during 2013. The company is a major competitor developing, publishing and marketing new age gaming and entertainment products, for game consoles, personal computers, mobile devices, and online players/participants. Activision has been a leader in gaming for decades. The advent of multiple person gaming, advanced graphics design and technology, internet delivery of entertainment, wireless mobile devices, and a combination of all the above have encourage truly interactive, real-time options for players across the world. As a result of nearly real life sensory experience and interactive gaming, companies like Activision, Disney (DIS), Sony (SNE), Nintendo (NTDOY), Microsoft (MSFT), Electronic Arts (EA), Take-Two (TTWO) have gaming software divisions that rival the appeal, economic impact and importance in society of Hollywood movie studios from earlier years. In fact, opening month sales for the biggest video game releases now eclipse the equivalent numbers from the biggest movie openings in 2012-13!
Activision publishes hundreds of games for every major platform, operating system, and console maker in the world, with nearly 7,000 employees. One of Activision's top money-making franchise games just introduced a new update this week, Call of Duty: Ghosts. Initial reviews from gamers are decent, although not earth shattering. Metacritic had an early score of 76 out of 100. The company reported $1 billion in sales for the new version, just to stock retail outlets for expected consumer demand. Another cornerstone of revenues is Activision's global leader in subscription-based, multi-player, online role playing game, World of Warcraft, having 7.6 million subscribers at the end of September. Sales and profits are expected by Wall Street consensus forecast to jump considerably into 2014 for the whole industry, including Activision, with the rollout of new generation consoles by Sony (PlayStation), Nintendo (Wii and DS) and Microsoft (Xbox) for Christmas 2013. A wave of upgrade buying and renewed spending on game software by consumers is expected to be in the early stages

So in my opinion, Activision Blizzard (ATVI) will be the best choice for the guys who want to buy some stock about game companies.

Finance and Marketing Budget

From Activision Blizzard nearly three years balance sheet，it can be seen that Activision Blizzard care each year, the total assets growing very rapidly, and because in 2013's third quarter, Activision Blizzard launched a $ 8.2 billion to repurchase shares of action, making its influence in the industry improved significantly, which can be seen, Activision Blizzard in the next phase of development will be good.

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