Bobby Kotick just played his last and best hand

How the merger between Activision and Microsoft bails the CEO out

Ah yes, the merger of the week, or maybe even the year. Microsoft is buying Activision Blizzard for a massive 70 billion dollars. The biggest acquisition in tech-history if I’m told correctly.

And yes, I do have my thoughts on the merger, which are mostly positive. But before we get to that, let me explain why you could care about my thoughts. I’m, after all, just some random dude on the internet, right?

Well, you could say that, but actually I’ve been working in the tech/games/car business as an editor for a couple of large Dutch publications for about 15 to 20 years, so I’ve seen my fair share of things. And more importantly I kinda have the feeling I know how stuff works in the business.

Now, that doesn’t mean I’m the expert to whom you should listen, not at all. I’d point to some business analyst on Wall Street who’s been doing speculation for a couple of years for that. He’s the real expert, as you probably know. No, I’m just looking at it from my point of view, which might be a little different than you mostly read about.

So let’s get going…

The merger of the year seems more like a great opportunity for Microsoft and a bail out for Bobby Kotick, the CEO of Activision Blizzard. It’s not at all about getting ready for the metaverse. That shit isn’t going to happen for a couple of years, if at all.

Microsoft made the perfect move with this merger. It paid $95 dollars a share, which accounts for a premium of 45% per share. But when you look at the share price at the beginning of 2021, it was even higher than the $95 M$ is going to pay. It was being traded at almost $105 before the shit hit the fan at Activision Blizzard.

The company from Redmond played the waiting game perfectly, with Phil Spencer, Head Honcho at Xbox, being politically correct as always by not attacking Kotick and his company too harshly. He was playing another game: waiting for the share price of Activision Blizzard to drop to a significant point and the scandal to escalate, so they could offer Kotick a quick way out without losing face and pretty much steal his company for an absolute bargain price.

So no, I don’t think Kotick and Spencer where already talking of working together for years. They probably didn’t have any plans to join forces to make their way into the metaverse with AI-generated content and stuff about machine learning. Does Kotick even know what those buzzwords mean?

And no, I don’t believe a word of what Kotick is saying to be the reason for the sale of his so beloved company. Pushing two games out because they aren’t finished and blaming falling share prices on that. Come on, we’re not that stupid…

Kotick allegedly even tried to change the narrative around the scandal at his company by trying to buy some media outlets.

All we know about the controversial CEO is that he was probably loved by his shareholders for generating a lot of revenue in the 30+ years he’s been running the company. Destroying great game franchises along the way and getting hated by more and more gamers along the way? Totally worth it.

His female co-workers for sure didn’t like him…

But even after so much backlash from industry representatives and employees, the CEO still wouldn’t resign. Why? Because he was getting paid to bail out without losing face by Microsoft. Who wouldn’t take that deal? I know I would.

You can probably guess that Kotick and Spencer didn’t call each other and reach an agreement for the merger just last week. These talks have been going on for the better part of last year. All while the pressure on Kotick was mounting.

And even now, when the merger has been announced and is only awaiting scrutiny from regulatory agencies and the likes, Kotick still isn’t saying he’s going to leave the company once the ink dries.

But the language in the press releases said enough if you can read between the lines. And even the interviews afterwards were fuzzy enough to know what’s really playing. Kotick is getting a big payday (of about 400 million dollar, I’m led to believe) when the deal is approved, and is probably leaving that same day.

So all we can say is: well played dear mister Kotick, well played. He didn’t have a great hand to play with, but he managed to pull out a win for him and his shareholders. And in the process the employees are likely winners too.

Why? They are going to work under Microsoft who promises to clean house once they are in charge. And looking at their track record, they’re good at that too. And maybe, just maybe, we gamers might also get what we want.

When the pressure for exponential growth is lessened and company culture is improved, there might be some room to get some good games out of the publisher. Just like we used to in the good ol’ days. Maybe Activision Blizzard will take a risk on a new and fresh franchise, not just the endless sequels which are released before they’re even finished (which almost seems like an industry standard these days).

And to top it off, we all get to play it on Game Pass. Which is, at least to me, the future of gaming. I’m absolutely in love with the concept and am a very happy subscriber.

So, in closing, I want to congratulate everybody involved for doing a great deal, even it’s by playing it dirty, maybe even very dirty. But sometimes that’s needed for everyone to win.