THAT MERGER with Blizzard is expected to be fully sanctioned by shareholders soon and the two huge organisations will then surely start to consolidate.
What that means to jobs, HQs or partners across Europe, publishing boss Joerg Trouvain isn’t saying just yet. He’d rather focus today on Activision’s tremendous performance. And – without wanting to linger too much on the past – it is also clear that Activision has changed as a company.
Not so long ago, good staff were leaving every week and smiles were hard to find at Activision HQ. Now the company is all about record sales, huge targets and recruitment drives. Just last week, Activision began a pan-European search for around 20 new staff – all for Guitar Hero.
MONSTERS OF ROCK
Why so many people needed? Consider that Activision expects its Guitar Hero business across Europe this year to be nearly as big as the entire Activision business last year, and you start to get the picture.
We have had a very successful year to date and so has the industry overall. But we have outperformed the market and expect further significant growth this year,” Trouvain begins.
Not so long ago IDG were predicting a market decline, but they have been wrong. Clearly sales have been driven recently by GTA IV and Wii Fit, whilst Call of Duty 4 and Guitar Hero have remained in the Top 10.
We don’t see the trend for growth reversing over the rest of the year. Year to date, end of May, the UK market is up 46 per cent by value, but Activision is up 60 per cent. Our target is to keep outperforming the market.”
Much of Activision’s progress has been down to a small clutch of stellar performers. And each time a new blockbuster arrives, their potential is greater than the last. Lego Indiana Jones, for example, shipped two and a half times more copies than the best-selling Lego Star Wars 2.
Indy sold over 100,000 in its first week in the UK. It was close to Call of Duty 4 in terms of pre-sale. Given that it’s a summer release, this is astonishing,” adds Trouvain.
Looking forward, Activision has a wide range of titles covering everything from hardcore to casual genres. Kids’ movie licence Kung Fu Panda arrives on June 27th, followed by other big hopes Guitar Hero Aerosmith, Call of Duty: World at War, Quantum of Solace, plus more Spiderman, Transformers, Madagascar and Marvel SKUs.
Clearly, understanding the importance of Guitar Hero is key to understanding Activision’s current bullish mood.
That comment about the franchise having the potential this year to be close to the publisher’s entire Euro business last year is no idle boast. As well as the Aerosmith release, Guitar Hero On Tour for DS is a massive title (complete with hardware bundle), there will, of course, be a Guitar Hero 4, plus Guitar Hero: World Tour and downloads too.
The music genre is absolutely huge and will get much bigger in Europe. Singstar pioneered it and Guitar Hero has built on it, as have others such as Rock Band,” Trouvain explains.
Europe is still a long way behind the US, so has enormous potential. How can we make it nearly as big as our entire business last year? More SKUs and fantastic experiences for the consumer.
The DS, for example, has the same installed base in Europe as in the US, but software sales are stronger. There will also be more Euro-centric tracks added to the new Guitar Hero products.
We are growing the European Guitar Hero team with 20 additional heads. We want the best talent.”
Given the size of the business, it is unsurprising that Activision will soon announce its first dedicated Euro boss for the music franchise. But nothing will be revealed until ‘Day One’ has arrived and that Vivendi deal has been completed.
Trouvain expects all to be revealed within six weeks, but dodges any further questioning about the merger’s ramifications. He’d rather talk about the positive mood within the market as a whole instead, dismissing any talk that over-saturation of product or economic factors could mean a sudden slowdown.
Our industry has been pretty immune in the past to the ups and down in the economy. Plus we are seen more and more as good value by consumers, because of the quality of the experience and the amount of time that a good game gets played.”
We have grown, possibly at the expense of other markets such as music and toys. Video games can now compete across all age groups, gender, price point and experience – from Call of Duty to Wii Fit.”
No European boss of a giant corporate entity like Activision is going to give too much away when it comes to numbers, but Trouvain is confident enough to reveal at least one aim for the coming years: matching the company’s super-successful US operation.
Clearly the focus for the company this year is very much on Europe. We dropped back a long way a couple of years ago and still have ground to make up.
"Our growth target is far bigger than the growth target for North America this year and, eventually, the ambition is to make Europe as big overall as the US.”