Acti-Blizz buyout, day two: Labor, stock, Kotick, and the reasons behind the sale

    
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YAAAAAAGH

The news has been flying fast and furious over the last 24 hours since Microsoft announced it was buying Activision-Blizzard for just under $70B. Here’s where we stand since then.

The budding labor alliance, A Better ABK, marches on. The strike over fired QA and poor treatment of contract workers continues, and union organizers who’ve mobilized since the sexual harassment and discrimination scandal erupted say that they’ll continue fighting against abuses within and without Activision-Blizzard no matter who’s in charge, particularly given that the company is still refusing to acknowledge their demands.

“The news of Activision’s acquisition by Microsoft is surprising, but does not change the goals of the ABK Worker’s Alliance. We remain committed to fighting for workplace improvements and the rights of our employees regardless of who is financially in control of the company. We will continue to work alongside our allies across the gaming industry to push for measurable change in an industry that desperately needs it. We called for the removal of Bobby Kotick as CEO in November for shielding abusers and he still remains CEO as of this writing. The strike for Raven QA is in its fifth week, and our striking staff has still not received response from leadership regarding our request to negotiate. And finally, 3 out of 4 of our original collective demands to improve the conditions of women in our workforce have not been met. Whatever the leadership structure of the company, we will continue our push to #EndAbuseInGaming, and appreciate the outpouring of support we’ve experienced in the last year.”

CODE-CWA urged investigators to examine the sale’s impact on workers. The massive labor organization, which backs A Better ABK, urged the Department of Justice, the FTC, and state attorneys general to “carefully consider the impacts on consumers” and workers: “Activision Blizzard’s response to its employees’ concerns has been repeated surveillance, intimidation tactics & the hiring of notorious union busters. @ABetterABK ‘s concerns must be addressed in any plan – acquisition or not – on the future direction of the company.”

Kotick continued downplaying the sexual harassment and discrimination scandal that has plagued Activision-Blizzard for half a year. In an interview with GamesBeat, Bobby Kotick insisted that the move is about leveraging Microsoft’s cybersecurity, AI, and machine learning talent to execute on Kotick’s vision. He also argues that the delay of Overwatch and Diablo caused the steep decline in ATVI stock, rather than the lawsuit and scandal. (That certainly deepened the dip, but it didn’t start with that call.)

Microsoft, however, approached Kotick specifically because the company was perceived as open to acquisition thanks to the scandal and lawsuits. According to Bloomberg’s sources, Phil Spencer approached Kotick both to encourage culture change and to “to ensure that if Kotick and the board were willing to sell the company, Microsoft would be well positioned to make an offer.”

ATVI stock has rebounded on the news. Thus far, it’s recovered what it lost after the delay announcement in the November conference call, though not what it lost between summer and then.

So is Kotick in or out? As we noted yesterday, The Wall Street Journal has sources who claim Kotick has agreed to depart when the deal closes – in the middle of next year. At that point, he’d collect his massive severance. Until then, he’ll run the company through the merger and all the regulatory oversight and approvals it’ll entail. Don’t expect much more beyond rumors and leaks until then.

Finally, Kotick was apparently considering trying to buy up some of the press outlets that have been critical of the company. Among the outlets namedropped were Kotaku and PC Gamer. Because this is a thing that normal, stable, successful companies with nothing to hide do. Yikes.

Activision-Blizzard is considered a controversial company in the MMO and gaming space owing to a long string of scandals over the last few years, including the Blitzchung boycott, mass layoffs, labor disputes, and executive pay fiasco. Last summer, the company was sued by the state of California for fostering a work environment riddled with sexual harassment and discrimination, the disastrous corporate response to which has further compounded Blizzard’s ongoing pipeline issues and the widespread perception that its online games are in decline. Multiple state and federal agencies are investigating the company as employees strike and call for Bobby Kotick’s resignation.
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