Activision Blizzard spoke of large-scale decommissioning implementation and future prospects for reducing management costs in the investor's revenue and expenditure report (conference call) held in accordance with the announcement of the financial results of the fourth quarter of 2018, explained to investors on why the collaboration with Bungie was dissolved in January of this year (Seeking Alpha).
Activision and Bungie had an alliance with the "Destiny" franchise for eight years, but have resolved the partner contract in January of this year. "Destiny" franchise will be sold by Bungie in the future (related article). At the time of the settlement of the third quarter in 2018, Activision announced that the big extension "Destiny 2" "loneliness and shadow" the sales results that were in line with the company's expectations (in the third quarter, "loneliness and Shadow ", affected by congestion, revenue from console games / services fell 34% year-on-year). And with this revenue and expenditure report it was revealed that the bad sale of "Destiny 2" was one reason to cancel the contract.
COO Coddy Johnson of Activision Blizzard replied that the deal was the right choice for both companies and Bungie could concentrate on the growth of his IP market as Bungie wanted and Activision is a project to generate more revenue. It was explained that it is a decision where the interests were consistent if we could focus our attention on.
Since the IP of "Destiny" is owned by Bungie, it is mentioned that it was difficult to increase sales with a new user engagement model like other large franchises of Activision Blizzard. Activision also supports the development and management of the "Destiny" series, which also refers to the fact that it has spent its own development resources. As mentioned above, Activision Blizzard has announced that it will make a large-scale dismissal of 700 people or more, mainly by staff other than the development team, in the revenue and expenditure report. Instead, they said they plan to promote company-wide corporate restructuring to raise development resources by 20% in 2019 and concentrate development opportunities on their main IP. And with the cancellation of the partner contract with Bungie, it is possible to convert the development tools assigned to "Destiny 2" to its own IP.
For various reasons, the fact that the "Destiny" franchise was unable to generate the revenue that Activision would expect, however, seems to be the biggest factor in strengthening the decision of Activision. Although Johnson says the "Destiny" franchise is "highly valued content of high quality", he could not leave enough figures for Activision. The contribution of the "Destiny" franchise was estimated to be low, even when making an income estimate for 2019. As mentioned earlier, obtaining the right to publish "Destiny" was what Bungie wanted, and on the basis of the In the current situation, this was the optimal choice for both companies, as a result of which the contract was canceled.
Activision Blizzard recently announced large-scale redundancies and closed King's San Francisco studio, which acquired it in 2016, and Z2Live, a subsidiary in Seattle (VentureBeat). Gameworker Unite, which is committed to the protection of workers' rights in response to these cuts, has launched a "# Fire Bobby Kotick" campaign calling for the rejection of Bobby Kotick from Activision Blizzard on SNS. Several other people are worried about the judgment of Activision Blizzard, Seamus Blackley, known as the maker of Xbox, said that he has admitted his skills as a manager of Bobby Kotick, but has faced developer development rights for many years, unfortunately this is I also resign normally to Mr. Kotick on TwittercontributionIt is. The share price of Activision Blizzard did not collapse after the announcement of the financial results, as redundancies are promoted as part of the corporate reorganization, as well as the performance of the company in 2018 itself were good. As well as an explanation for investors, it seems that from the point of view of the protection of employees there is still a serious view of large-scale redundancies.