Microsoft submits new Activision Blizzard plan in £54bn takeover battle 

with UK competition watchdog

August Graham, PA Business Reporter
Tue, 22 August 2023 

The competition watchdog stressed “this is not a green light” as it agreed to look at a fresh proposal from Microsoft which the company hopes will allow its 69 billion US dollar (£54 billion) takeover of Activision Blizzard to go ahead.

The global technology giant said it has submitted a new version of the blocked deal, which will now be reviewed by the Competition and Markets Authority (CMA).

It came as the regulator confirmed on Tuesday that Microsoft’s original plan to buy the computer games company “cannot proceed”.



Under the new proposal, Microsoft would sell off its rights to offer games via the cloud for new or existing Activision PC or console games for the next 15 years outside the European Economic Area (EEA).

It will instead sell those rights to Ubisoft, a rival developer known for the Assassin’s Creed and Far Cry games series.

This is designed to ensure that gamers have access to Activision Blizzard’s games, even on consoles and computers not made by Microsoft.

The CMA will now launch a new probe into this deal, a so-called Phase 1 investigation.

World Of Warcraft became globally popular after it was released by Blizzard Entertainment in 2004 (Paul Carstairs/Alamy/AP)

CMA chief executive Sarah Cardell said: “The CMA has today confirmed that Microsoft’s acquisition of Activision, as originally proposed, cannot proceed.

“Separately, Microsoft has notified a new and restructured deal, which is substantially different from what was put on the table previously

“This is not a green light. We will carefully and objectively assess the details of the restructured deal and its impact on competition, including in light of third-party comments.”

Microsoft president Brad Smith said: “Under the restructured transaction, Microsoft will not be in a position either to release Activision Blizzard games exclusively on its own cloud streaming service, Xbox Cloud Gaming, or to exclusively control the licensing terms of Activision Blizzard games for rival services.”

The CMA locked horns with one of the world’s largest technology companies over the deal (Anna Ivanova/Alamy/PA)

It marks a new twist in the case, the biggest fight the CMA has taken on since gaining new post-Brexit powers. At one point the case looked like as though it would only end after a court battle.

In January 2022 Microsoft announced that it planned to buy Activision Blizzard, the company behind the Call Of Duty and World Of Warcraft games, for an eye-watering sum.

When the UK was still an EU member, a deal of that size would have been assessed by regulators in Brussels. But after Brexit the CMA now has the power to investigate such deals itself.

Although both companies are American, both have significant businesses in the UK so their tie-up could have a significant impact on competition here.

Activision Blizzard chief executive Bobby Kotick said: “For us, nothing substantially changes with the addition of this divestiture: our merger agreement with Microsoft, closing deadline, and the cash consideration to be paid for each Activision Blizzard share at closing remain the same.

“We will continue to work closely with Microsoft and the CMA throughout the remaining review process, and we are committed to help Microsoft clear any final hurdles as quickly as possible.

“This has been a longer journey than expected, and I am very proud of how focused everyone has remained on delivering great games.”

Why does Microsoft want to buy Activision Blizzard and will the deal go ahead?


Alan Martin and Vicky Jessop
Tue, 22 August 2023 

Activision’s biggest game is Call of Duty (Activision Publishing Inc)

Microsoft announced its intention to buy Activision Blizzard in January 2022. The story has popped up countless times since as more roadblocks appeared, and were navigated around.

One key one remains: the UK’s Competitions and Markets Authority (CMA).

The acquisition has been given the green light by EU and US regulators, but the CMA is still holding out. Why?

Any acquisition this size is a big deal. Microsoft plans to buy Activision Blizzard for £54 billion. It is one of the biggest game publishers out there, and clearly of higher value than Skyrim creator Bethesda Softworks, which was acquired by Microsoft for around £6 billion in 2021.

The big story was initially around Call of Duty, and whether it would become an Xbox-only series. Microsoft has now promised to bring Call of Duty to Sony PlayStation and Nintendo consoles for the next decade.

However, that has not placated the CMA. Its concerns hinge on cloud streaming, used in Microsoft’s Xbox Game Pass service. It argues the merger will be bad for consumers and innovation, by giving Microsoft an unfair advantage in the area.

In a last ditch attempt to get the deal through, Microsoft submitted a fresh proposal on August 22.

It would see Microsoft offload game streaming rights for Activision Blizzard games to Ubisoft, for PC and console titles released over the next 15 years. Microsoft would no longer determine which streaming services get the publisher’s games, Ubisoft would.

But why is Microsoft so keen on buying Activision Blizzard in the first place?

What games does Activision Blizzard make?

The biggie is Call of Duty or ‘CoD’. The military first-person shooter is one of the most popular games on the planet, and always elicits excitement when a new entry is released.

Both Activision and Blizzard have been in the business for decades, long before they merged in 2013 after Activision acquired Vivendi Games. They have plenty of beloved franchises beyond CoD, including Warcraft, Overwatch, and even Candy Crush, after the 2016 acquisition of mobile game maker King.

Here are the main ones:

Activision

Call of Duty


Crash Bandicoot


Spyro


Tony Hawk’s Pro Skater


Prototype


Hero (Guitar Hero, DJ Hero, Band Hero)


Candy Crush
Blizzard

Warcraft


Diablo


Overwatch


Starcraft


Hearthstone

These are just the main players and there are plenty of long-forgotten IPs that could be revived: think King’s Quest, Blur, Gabriel Knight, True Crime, and Gun.

Why is Microsoft trying to buy Activision Blizzard?

Overwatch 2 (Activision Blizzard)

While once known exclusively for home-computer software (Windows, Office, Outlook, Word, etc.) Microsoft now has fingers in many pies — and gaming is one of the biggest, thanks to the Xbox gaming division.

That would be reason enough to try to add one of the world’s biggest publishers into the fold, with exclusive games often helping decide console wars, and Microsoft currently fighting a losing battle against Sony’s PlayStation 5.

But having popular franchises such as Call of Duty, Overwatch, and Warcraft as part of the Microsoft stable is especially significant due to the company betting much on Game Pass — its ‘Netflix of games’ — where you can play a rolling selection of titles for a low-cost monthly subscription.

Microsoft’s games — including Gears of War, Forza, Halo, and Minecraft — are already included, and the company would love to add Activision’s titles to the platform to boost subscriber numbers.

What is the problem with Microsoft buying Activision Blizzard?

The reason the purchase has been bogged down by legal action is competition. By acquiring Activision Blizzard, critics argue, Microsoft’s gaming division would simply own too much of the industry, unfairly limiting its competitors and ultimately harming consumers.

In the US, the Federal Trade Commission (FTC) initially attempted to block the deal, with it voting three to one to issue a complaint against the buyout. In the UK, the CMA concluded that the move would ultimately result in higher prices, fewer choices, and less innovation for UK gamers.

But, following a string of victories, Micrososft’s takeover of Activision appears more likely to go ahead. An American judge vetoed the US Federal Trade Commission’s (FTC) attempt to block the deal. While the FTC has launched an appeal, the UK’s Competition and Markets Authority has halted its own legal battle.

Those hurdles included shortcomings in the regulatory remedies proposed by Microsoft in its bid to get the merger across the line. The tech giant signed cloud gaming deals with Boosteroid, Ubitus, and Nvidia to bring Xbox PC games to these services. It also signed a similar deal with Nintendo last December.

Many of critics’ problems come from exclusivity. To get the main benefit from an acquisition, many assume Microsoft would have to make future titles from Activision Blizzard exclusive to Xbox and PC, freezing out PlayStation gamers.

The Sony PS5 (PS5)

In terms of precedent for that, Microsoft has announced that Bethesda’s first game as a Microsoft studio — Starfield — won’t be appearing on PS5. It seems unlikely that a future Fallout of Elder Scrolls will either.

That said, Microsoft hasn’t pulled Minecraft from Sony or Nintendo platforms since purchasing the game back in 2014. And for its part, as part of the ongoing argument, Microsoft has offered to keep Call of Duty — the main prize of contention for rivals — on Sony and Nintendo platforms for a decade after the deal completes.

Microsoft president Brad Smith made the pledge in an opinion piece for the Wall Street Journal in December. He said that the deal was good for gamers because Microsoft was “third place in console gaming, stuck behind Sony’s dominant PlayStation and the Nintendo Switch”.

What would Microsoft buying Activision Blizzard mean for big games like World of Warcraft?

Those reassurances aside, the concerns of Microsoft’s rivals are that big franchises will either be exclusive to Xbox and PC, or be otherwise hobbled on other formats with weaker performance or less DLC.

Even if Microsoft were to continue releasing its games on other formats, its rivals are concerned that they can’t compete with the Game Pass offering, where paying £70 or more for top-tier games is replaced with a flat monthly subscription.

Blizzard’s games such as World of Warcraft and Starcraft, which have never had a console version, might be pushed on to Xbox in time, too. Though, given Microsoft has a substantial interest in Windows PCs, this wouldn’t necessarily be an urgent priority.
Is Microsoft’s takeover of Activision likely to go ahead?

Spyro Reignited Trilogy (Activision)

The UK’s CMA is the last major hurdle for the acquisition, after the deal was greenlit in key markets including the US and EU. Microsoft’s final gambit is the proposal to offload streaming rights for Activision Blizzard games released over the next 15 years to publisher Ubisoft, excluding existing agreements within the EEA.

“Under the restructured transaction, Microsoft will not be in a position either to release Activision Blizzard games exclusively on its own cloud streaming service—Xbox Cloud Gaming – or to exclusively control the licensing terms of Activision Blizzard games for rival services,” wrote Microsoft President on the company’s blog.

The CMA says it will decide on whether that plan is enough to allow the deal to pass through by October 18.

“This is not a green light. We will carefully and objectively assess the details of the restructured deal and its impact on competition, including in light of third-party comments,” says the CMA.

What does this mean for gamers?

Gamers who feared Microsoft would renege on its promise to make Activision games widely available may be concerned about recent developments.

PlayStation owners, in particular, may have been sceptical about Microsoft’s assurances to keep CoD on Sony’s consoles for ten years. In fact, Microsoft had already indicated that it wasn’t interested in extending that commitment. It said thata decade was plenty of time for Sony to create a CoD rival, signalling that it was prepared to pull the rug out from underneath its competitor as soon as the deal timer ran out.

The UK also threw doubt over Microsoft’s plans to add Activision games to other gaming platforms, including Nintendo consoles.

In a bid to assuage regulators, the tech giant had struck high-profile deals to bring Xbox PC and Activision franchises, including CoD and Overwatch, to rival platforms. They included ten-year contracts with cloud-gaming services including NVIDIA Geforce Now, and smaller competitors such as Boosteroid and Ubitus. It also struck a similar deal with Nintendo in December.

If Microsoft loses its appeal, then it will essentially be up to Activision to secure similar licensing deals with these distributors. Seeing as the company removed its games from GeForce Now in 2020, and hasn’t restored them since, it clearly has some misgivings about cloud gaming.

Meanwhile, Microsoft’s Nintendo deal felt like lip service to regulators. The Japanese company is largely associated with family-friendly titles such as Mario, and already has access to Activision’s Overwatch games. CoD therefore felt like a mismatch for Nintendo. Nor does the Switch boast the computing power to run the latest CoD games.

All told, Activision will have little incentive to pursue a similar deal with Nintendo, should the merger fall apart.

Who owns Activision?

As of now, Activision Blizzard is still an independent, publicly traded company owned by its shareholders. A mixture of financial conglomerates and asset managers currently hold stakes in the gaming giant, including Warren Buffet’s Berkshire Hathaway, Vanguard Group, FMR LLC, and Blackrock.

The US-based video game firm was established in 2008 following the merger of Activision and Vivendi Games. The latter was the games division of French media conglomerate Vivendi, which owned Blizzard Entertainment and its blockbuster multiplayer game World of Warcraft.

Activision traces its roots back to 1979, when it was founded by a group of former Atari developers. Originally called Computer Arts, Inc., the team later changed the company’s name to a portmanteau of “active” and “television”. Thus, Activision was born.

Activision Blizzard CEO Bobby Kotick took the reins in 1991 after purchasing a company stake the previous year. Kotick orchestrated the merger with Vivendi Games in the 2000s, which led to the formation of Activision Blizzard, and made him the company’s first CEO.

Today, the company is composed of five business units: Activision Publishing; Blizzard Entertainment; King, which it acquired in 2016, Major League Gaming, and Activision Blizzard Studios.

BRO CULTURE

Report: Activision Took Years To Fire Someone Who Signed Emails '1-800-ALLCOCK'


Ethan Gach
Fri, November 19, 2021


A California lawsuit earlier this year alleged sexual harassment, discrimination, and a pervasive “frat boy culture” at Call of Duty publisher Activision Blizzard. At least in one instance, that culture included an employee signing all of his work emails as “1-800-ALLCOCK.”

That detail comes from the latest episode of The Wall Street Journal podcast which elaborates on some of its recent bombshell investigative report outlining new instances of misconduct and coverups, including by CEO Bobby Kotick.

“There was one example where an Activision employee had for years just signed his email signature 1-800-ALLCOCK,” reporter Kirsten Grind said in a transcript of the podcast. “So if you were a woman, you would get that email and that was just the normal course, right? Just guys being guys joking about it and you just sort of felt like that was what happened at Activision.”

Activision reportedly didn’t take action regarding the email signature until it received a complaint about it just this past summer, at which point it fired the employee after a month-long investigation. The company did not immediately respond to a request for comment.

The podcast episode also interviewed a former employee about her time at Sledgehammer Games, maker of the recently released Call of Duty: Vanguard. Ashley Mark, hired as a quality assurance analyst in 2016 during the production of Call of Duty: WWII, described the male-dominated workplace like this:

You’ve got people who want to...Basically are very nerdy, want to make a good game, and then you’ve got the gun-loving group because it’s Call of Duty so you’re going to attract people who love guns, and then you have got people who are really into fitness. There’s a lot of people who are into fitness at least at that time at Sledgehammer Games. So there were people who would go into groups and that you would go to the gym and they would just get pumped up. So it’s very masculine.

Mark recalled a 2017 studio anniversary party where one former Sledgehammer manager “put his arm around my female coworker almost like a choke hold” while hugging her and repeatedly saying her name. That former manager told The Wall Street Journal he didn’t remember the details of the evening in question because he was too drunk, but confirmed he was put on a two-week paid suspension before being moved to a different role.

Sledgehammer Games was also where one former female employee was reportedly raped twice, incidents that were not investigated until she sent a letter from her lawyer after she had already left the company. According to the new podcast episode, when she originally to her complaint to studio HR, a representative for the department tried to get her to down play what had happened and reframe it in a more positive light.

Until recently, most of the attention has been on allegations about past misconduct and discrimination at Blizzard. But these latest reports reinforce parts of the original California lawsuit which cited booze-filled offices and work events, and negligent HR departments, as recipes for mistreatment across the entire Activision Blizzard business.

This week, the heads of both PlayStation and Xbox spoke out about the latest revelations. Girls Who Code cut ties with the company. And some shareholders joined over 2,000 current Activision Blizzard employees in calling for Kotick to resign.

“It’s pretty clear that the only forces that can create change at Activision are its customers (whose money is the ultimate corporate goal), its investors and the employees whose talent makes Activision’s games worth buying,” Paul Reiche, former head of Activision Blizzard’s Skylanders studio, told Axios today. “If the new stories I have read are true, I can’t see how Activision can continue its success without new leadership”

Microsoft reportedly evaluating relationship with Activision amid CEO turmoil

Brett Molina, USA TODAY
Thu, November 18, 2021,

Activision Blizzard says it hired a law firm to help ensure a "respectful and inclusive" workplace.

Microsoft is reportedly evaluating its relationship with video game publisher Activision Blizzard following allegations CEO Bobby Kotick knew for years about sexual misconduct claims at the company.

Xbox head Phil Spencer sent an email to staff, according to Bloomberg, saying he is "evaluating all aspects of our relationship" with Activision Blizzard following a report from The Wall Street Journal claiming Kotick didn't inform the board of allegations of sexual misconduct at the publisher.

In a statement emailed to USA TODAY in response to the report, Spencer said he personally has strong values for a welcoming and inclusive environment for Xbox employees.

"This is not a destination but a journey that we will always be on," said Spencer. "The leadership at Xbox and Microsoft stand by our teams and support them in building a safer environment for all."

Activision told USA TODAY in an emailed statement it respects feedback from its partners and is engaging with them further.

Employees at Activision Blizzard staged a second walkout demanding Kotick be removed as CEO, NBC News reported. A Twitter account representing employees of the company shared a petition seeking Kotick's removal that has more than 1,000 signatures.



In a statement released Tuesday after the Journal report, Activision's board showed support for Kotick. "The Board remains confident that Bobby Kotick appropriately addressed workplace issues brought to his attention," it said.

Earlier this year, the state of California sued Activision Blizzard claiming the publisher fostered a sexist culture and paid women less than men despite doing more work.

The lawsuit prompted employees' initial walkout urging changes within the company's culture.

Follow Brett Molina on Twitter: @brettmolina23.

This article originally appeared on USA TODAY: Activision Blizzard: Microsoft reportedly evaluating relationship

Xbox is re-evaluating its relationship with Activision Blizzard


Kris Holt
·Contributing Writer
Thu, November 18, 2021

Phil Spencer is reportedly reassessing Xbox's relationship with Activision Blizzard following new bombshell reports about the company and CEO Bobby Kotick. Spencer, who runs Microsoft's Xbox division, reportedly told employees in an email that he's “evaluating all aspects of our relationship with Activision Blizzard and making ongoing proactive adjustments,” in the wake of an investigation by The Wall Street Journal.

In the memo, which was obtained by Bloomberg, Spencer said he and other leaders at Xbox are “disturbed and deeply troubled by the horrific events and actions” that reportedly took place at Activision Blizzard. "This type of behavior has no place in our industry,” Spencer wrote.

Kotick is said to have known about instances of sexual misconduct at the company for years without reporting them to the board. He has also been accused of mistreating women on numerous occasions.

Spencer has joined Sony Interactive Entertainment CEO Jim Ryan in expressing deep concern about the situation. In an internal memo, which also leaked earlier this week, Ryan wrote that he was "disheartened and frankly stunned to read” The Journal's report. He also criticized Activision's response to the allegations. Earlier this week, the company told Engadget that the report presented a “misleading view of Activision Blizzard and our CEO.”

More than 900 Activision Blizzard employees and contractors have now signed a petition demanding Kotick's removal. A shareholder group has also urged the board to remove Kotick and for the board's two longest-serving directors to retire by the end of the year. In addition, Polygon and Eurogamer both called for Kotick's resignation. Strongly worded statements from leaders at Microsoft and Sony, two of Activision Blizzard's most important business partners, will further crank up the pressure.

"We respect all feedback from our valued partners and are engaging with them further," an Activision Blizzard spokesperson told Engadget. "We have detailed important changes we have implemented in recent weeks, and we will continue to do so. We are committed to the work of ensuring our culture and workplace are safe, diverse, and inclusive. We know it will take time, but we will not stop until we have the best workplace for our team."

Activision Faces Internal Rifts in Bid to Blunt Uproar Over CEO



Jason Schreier
Wed, November 17, 2021

(Bloomberg) -- Some employees at Activision Blizzard Inc. said they were let down by internal meetings that were held Wednesday morning to discuss the new revelations about the company and Chief Executive Officer Bobby Kotick.

The gatherings took place on video calls across the game publisher’s three primary organizations, Activision, Blizzard and King. Executives in charge of each division took questions and shared similar talking points after the Wall Street Journal reported detailed allegations that Kotick was aware of sexual misconduct at the company years before a California lawsuit made them public this summer and failed to report alleged instances of rape to the board.

Hours after the article was published on Tuesday, more than a hundred employees staged a walkout to demand Kotick’s resignation. The board said it’s standing by Kotick, but partners and shareholders have raised questions about his handling of the crisis. Sony Group Corp.’s PlayStation chief Jim Ryan criticized Activision’s response in an email to staff Wednesday, Bloomberg reported. When asked for comment, the California State Teachers’ Retirement System, which owns more than a million shares in Activision, said in a statement that it recognizes that sexual harassment and misconduct incidents can result in “significant” risks to its portfolio holdings and that it continually monitors its holdings to address those risks.

The leaders said Kotick would be working to “regain trust” of employees throughout the company, according to partial transcripts from two of the meetings shared with Bloomberg. Activision president Rob Kostich told people in his group that Kotick wouldn’t be resigning, according to two attendees. Blizzard’s top executive, Mike Ybarra, told staff in what appeared to be pre-recorded remarks that he understood their frustrations and apologized for not being more active as a leader, according to two attendees.

Some employees of King, the makers of Candy Crush, asked whether a sudden announcement on Monday that they’d be getting bonus vacation days next week for Thanksgiving was meant to preempt the article. Activision Blizzard Chief Operating Officer Daniel Alegre denied that was the reason. In response to a question about whether Activision’s newly instituted “zero tolerance” policy on harassment, announced last month, would also apply to Kotick, Alegre said that his boss was “deeply and personally committed to doing the right things.”

Alegre also addressed the reported pay disparity between Ybarra and Jennifer Oneal, who were named co-leaders of Blizzard this summer following the lawsuit. Oneal, who resigned earlier this month, said she was paid less than Ybarra. Alegre said that Oneal was paid “differently” than Ybarra because of complications involving cash and equity and that “they were both offered the exact same compensation.”

But Oneal told Blizzard employees that she wasn’t offered compensation equal to Ybarra’s until she tendered her resignation, according to a Slack transcript reviewed by Bloomberg. Gaming website IGN earlier reported on the Slack exchange. Pay discrimination was one of the items listed in the California lawsuit.

The company also told staff that it’s banning alcohol in all offices. Many people were given the opportunity to take paid mental health days, which some staff said hadn’t mollified them. On video calls and in Slack channels across the company, calls for Kotick’s ousting continue. Many Activision Blizzard employees are even publicly demanding on their own personal Twitter feeds that the CEO be fired.

In an email to Blizzard staff on Tuesday reviewed by Bloomberg, Ybarra wrote that “if there’s a silver lining to the last few months, it’s that they’ve proven that Blizzard is full of incredible employees who are making progress every day to improve our culture, our game communities, and ourselves.” Ybarra added that “our best years are ahead of us.”

But with morale low and Kotick still in place, some employees are skeptical about that.

Activision Blizzard Staff Announce Start of New Strike Action

The ABK Workers Alliance has also set up a strike fund.

By Matt Purslow
Updated: 9 Dec 2021 8:36 am

The ABK Workers Alliance, a collective of Activision Blizzard and King employees, has initiated strike action against its employer. The group plans to continue its work stoppage until its demands are met. This follows walkouts from other Activision Blizzard groups, including Raven’s QA department.

Announced via a post on Twitter, the group said “Today, the ABK Worker's Alliance announces the initiation of its strike. We encourage our peers in the Game Industry to stand with us in creating lasting change.”

In addition, the Tweet also includes a link to a Gofundme page, which allows supporters to provide financial donations to help participating Activision Blizzard and King staff through their work stoppage. “For those who wish to join in solidarity, please consider donating to our Strike Fund,” said the tweet. The fund has a goal of $1 million.

The announcement of the ABK Workers Alliance strike follows Monday’s news of Raven Software's QA team walkout over the termination of contractors. Striking staff were supported by other Activision Blizzard workers in solidarity, with further walkouts happening in Texas, Minnesota, and California.

Activision Blizzard employees launch strike fund, move closer to unionizing


(Washington Post illustration; Activision Blizzard; iStock)


By Shannon Liao

WASHINGTON POST

Today at 10:41 a.m. 

Activision Blizzard employees are creating a strike fund for workers who have been participating in a work stoppage since Monday.

Employees, in collaboration with media labor union Communications Workers of America, are asking workers to sign a union authorization card, which could eventually lead to a companywide vote on forming a union.

The strike fund is being listed on a GoFundMe page with a goal of $1 million, which would be used for the current work stoppage and future strikes. Company management told workers that they would be paid their wages for Monday through Wednesday of the walkout but not beyond, according to emails shared with The Post. If workers continue striking Thursday and onward, they will be unpaid or will have to use their own accrued paid time off.

The video games industry in the United States is not unionized, so a move to get workers to sign union cards is notable. It brings Activision Blizzard workers one step closer to organizing, although those who sign the authorization cards are not obligated to join a union.

Why is the games industry so burdened with crunch? It starts with labor laws.

One current Activision worker who requested anonymity for fear of retaliation said she signed the union card because “it’s the only option.”

“Do we want to work for a company that has a history of not only sexual abuse and protecting abusers but also sporadic layoffs that may hit us at anytime, especially as a contract QA worker? Or do I risk losing my job to try and make a change?" she said.

The GoFundMe page was created by Blizzard senior test analyst Jessica Gonzalez, who told The Post she was giving her 3-year-old child a bath while organizing the strike fund on gaming messaging app Discord. The effort coincides with Thursday’s Game Awards, a significant annual red-carpet event for the games industry in Los Angeles. It’s a time when some of the most eyeballs are on the games industry, and workers planned around that.

“Workers deserve better, and [CEO] Bobby Kotick is continuing to ignore us,” Gonzalez said Wednesday evening. Gonzalez had announced her resignation from the company in late November; her last day is Friday.

Over 60 workers at Raven Software, an Activision Blizzard-owned game studio, walked out of work Monday in protest of their parent company laying off 12 of the studio’s quality assurance testers on Friday. Hundreds of workers across Activision Blizzard joined Raven Software contractors in solidarity, and in protest of the layoffs.

Activision Blizzard workers have walked out three times in five months since the gaming company was sued in late July over sexual harassment and gender-based discrimination allegations.

At Blizzard, groping, free-flowing booze and fear of retaliation tainted ‘magical’ workplace

“Activision Blizzard just continues to show us all how to not effectively manage a business. And, as a longtime Blizzard player, it breaks my heart and as a trade unionist, it’s pretty infuriating, but I think this latest controversy at Raven is, again, entirely self inflicted on management’s part,” said Communications Workers of America (CWA) organizing director Tom Smith, who helped with the strike fund effort. “Their only path forward for this company is to meet the righteous demands laid out in the original walkout and committed to higher labor standards, which center workers having a meaningful voice and all company matters.”

Activision Blizzard did not immediately respond to a request for comment from The Post.

Over the past several months, Activision Blizzard has come under fire from many directions. In addition to the lawsuit from California’s Department of Fair Employment and Housing, it is also under investigation by the U.S. Securities and Exchange Commission and is being sued in an August class-action suit from shareholders alleging violation of federal securities laws. Additionally, there is an unfair labor practice complaint against the company filed by workers and the CWA.

Inside the Activision Blizzard lawsuit

On July 20, California’s Department of Fair Employment and Housing (DFEH) filed a lawsuit against video game publisher Activision Blizzard, alleging widespread, gender-based discrimination and sexual harassment. Here’s what you need to know:

The lawsuit followed an investigation by the DFEH that began in 2018 in response to complaints from Activision Blizzard employees. Activision Blizzard disputes the allegations, saying the lawsuit’s claims were “distorted, and in many cases false.”

17 current and former employees interview by The Post detailed a workplace culture where women faced multiple incidents of harassment from men in leadership positions, and alcohol was free-flowing.

A Nov. 16 report from The Wall Street Journal alleged that Activision Blizzard CEO Bobby Kotick was aware of sexual misconduct allegations at the company but did not inform the board of directors. The report resulted in an employee walkout, a letter from an Activision shareholder group and a petition signed by employees demanding the resignation of several executives, including Kotick.

The DFEH lawsuit alleges that J. Allen Brack, the president of Blizzard Entertainment, was personally aware of employee complaints of sexual harassment directed at men with senior positions at the company. It also alleges he did not effectively mitigate those issues. Brack stepped down from his position as president on Aug. 3. The same day, Activision Blizzard confirmed that an executive in Blizzard’s human resources department was no longer with the company.

In response to the lawsuit and the ensuing statements of company leaders, Activision Blizzard employees wrote an open letter to the company’s leadership on July 26, rebuking them what they perceived to be an “abhorrent and insulting” response to the lawsuit. Employees also organized a walkout July 28.

Several sponsors for Activision Blizzard-run esports leagues have pulled back advertising, The Post reported Aug. 5.

Content creators on Twitch and YouTube who often feature games made by Activision Blizzard have wrestled with how to approach the topic on their streams and videos.
Legal experts are interested in the outcome of the lawsuit, noting that the DFEH is highly selective in the cases it chooses to fight in court and that the suit could set a precedent for California labor law.

The U.S. Securities and Exchange Commission is also investigating Activision Blizzard, and has subpoenaed the company and several current and former employees. In a statement, Activision Blizzard said it was cooperating with the investigation.

Learn more about this story and the rest of the video game industry by following Launcher on Twitter and subscribe to Launcher on YouTube and Instagram.

Employees and investors are calling for Activision's CEO to resign amid reports that he knew for years about sexual harassment and rape allegations at the company

Ben Gilbert
Fri, November 19, 2021

Activision CEO Bobby Kotick.

Activision CEO Bobby Kotick knew for years about claims of sexual misconduct at his company, the WSJ reported.

More than 1,000 Activision employees have since signed a petition calling for Kotick to resign.

Xbox head Phil Spencer said Microsoft is "evaluating" its relationship with the "Call of Duty" publisher.

Activision's longtime CEO Bobby Kotick reportedly knew for years about a variety of claims of sexual harassment and rape at his company.

A huge new investigation by the Wall Street Journal details several specific examples of harassment and rape at Activision. Kotick was not only aware of those claims but, in a least one instance, reportedly intervened to keep a male staffer who was accused of sexual harassment despite the company's human resources department recommending he be fired.

In the wake of the report, more than 1,000 current Activision Blizzard employees have signed a letter calling on Kotick to resign.

"We, the undersigned, no longer have confidence in the leadership of Bobby Kotick as the CEO of Activision Blizzard," the letter says. "The information that has come to light about his behaviors and practices in the running of our companies runs counter to the culture and integrity we require of our leadership — and directly conflicts with the initiatives started by our peers. We ask that Bobby Kotick remove himself as CEO of Activision Blizzard, and that shareholders be allowed to select the new CEO without the input of Bobby, who we are aware owns a substantial portion of the voting rights of the shareholders."

And Activision employees aren't alone in calling on Kotick to resign — a group of Activision investors, albeit a small percentage of overall investors, are echoing the sentiment.

"It's clear that the current leadership repeatedly failed to uphold a safe workplace — a basic function of their job," Strategic Organizing Center (SOC) Investment Group director Dieter Waizenegger told The Washington Post this week. "Activision Blizzard needs a new CEO, board chair and lead independent director with the expertise, skill set and conviction to truly change the company's culture," he said.

Additionally, the heads of both Sony's PlayStation and Microsoft's Xbox issued statements internally.

PlayStation head Jim Ryan criticized Activision's response to the article. "We do not believe their statements of response properly address the situation," he said in an email obtained by Bloomberg.

Xbox leader Phil Spencer took his response one step further: Xbox is "evaluating all aspects of our relationship with Activision Blizzard and making ongoing proactive adjustments," the email from Spencer to staff, also obtained by Bloomberg, said.

Microsoft confirmed the email's veracity to Insider, and shared the following statement from Spencer: "I personally have strong values for a welcoming and inclusive environment for all of our employees at Xbox. This is not a destination but a journey that we will always be on. The leadership at Xbox and Microsoft stand by our teams and support them in building a safer environment for all."

When asked for comment regarding calls for Kotick to resign, Activision representatives pointed to the statement published by Activision's board earlier this week and said the sentiment stands: "The Board remains confident that Bobby Kotick appropriately addressed workplace issues brought to his attention," the statement said.

The Journal's report on Activision is the latest in an ongoing reckoning at the blockbuster video game publisher.

The State of California sued the company this summer over allegations that female Activision employees face "constant sexual harassment," from "having to continually fend off unwanted sexual comments" to "being groped." When employees report issues to human resources and management, the lawsuit claimed, no action is taken.

The suit — filed on July 20 to the Los Angeles Supreme Court — followed a two-year investigation conducted by California's Department of Fair Employment and Housing. It claims "Call of Duty" maker Activision fosters a "pervasive frat boy" culture where women are paid less for the same jobs that men perform, regularly face sexual harassment, and are targeted for reporting issues.

Activision Blizzard CEO's duty to disclose sexual misconduct claims falls into legal 'gray area,' expert says

Alexis Keenan
·Reporter
Sat, November 20, 2021

Bobby Kotick, chief executive officer of Activision Blizzard, attends the annual Allen & Company Sun Valley Conference, July 10, 2019 in Sun Valley, Idaho. (Photo by Drew Angerer/Getty Images)

On Wednesday, a group of Activision Blizzard (ATVI) shareholders joined a chorus seeking to oust longtime CEO Bobby Kotick after The Wall Street Journal reported that he knew of sexual harassment and rape claims at the gaming giant but failed to report some of them to the board.

The outcry has raised questions about Kotick's duty to disclose what he knew about sexual misconduct allegations within the video gaming company. Frustrations over the matter have been escalating since August when California's Department of Fair Employment and Housing sued Activision, alleging that female employees were subjected to sexual harassment and unequal pay.

“Generally, the CEO, CFO, anyone at that level, does have a fiduciary responsibility, if something comes to their attention — whether it's embezzlement or sexual harassment, or whatever it might be — to inform the board,” Jeffrey Cramer, senior managing director at Guidepost Solutions, and former federal prosecutor, told Yahoo Finance.

The Journal reported Monday that Kotick, who's also a board member, knew but failed to tell the rest of the board about the alleged rape of a female employee of Activision’s subsidiary, Sledgehammer Games, by her male supervisor. Internal documents, the Journal's report states, show Kotick held back the extent of what he knew about complaints “of employee misconduct in many parts of the company.”

The rape complaint, which was reportedly settled out of court without alerting the board, adds to federal regulatory investigations into the company's handling of misconduct.

On Tuesday, Activision's board released a statement in support of Kotick. "The Board remains confident that Bobby Kotick appropriately addressed workplace issues brought to his attention," the statement read.

At this stage, Cramer says, it’s not surprising that the board is maintaining public support for Kotick. Typically, the directors call for an independent investigation to find out who knew what, when, he says.

“The board will do a thorough review, and then once the board has more information," Cramer said, "that position might change."

'The standards are shifting'

Corporate law and governance experts say it's not just Kotick who can face scrutiny about who knew what, and when. It's unclear, he said, whether Kotick and the other board members could be legally liable for failing to alert shareholders and the board about alleged sexual misconduct. That's because of shifting expectations in the post #MeToo world, Douglas Chia a senior fellow at Rutgers Law School’s Center for Corporate Law and Governance, tells Yahoo Finance. Few courts, he says, have evaluated how fiduciary laws govern obligations of public company executives to disclose claims of sexual misconduct.

Employees of the video game company, Activision Blizzard, hold a walkout and protest rally on July 28, 2021. (Photo by DAVID MCNEW / AFP) 

“In today's environment, the standards are shifting, and there's more of an expectation that the investors want to know more earlier,” Chia says. “... There's nothing that really says what's legally required.”

The current legal landscape is “a very gray area” that likely invokes state corporate laws and federal securities laws that can pressure both the board and Kotick, according to Case Western Reserve University School of Law associate professor Anat Alon-Beck.

“I put it on the board, not just on the CEO,” Alon-Beck adds. “It’s a very delicate situation because the CEOs have obligations under securities laws to report on material events. I think today, after the #MeToo movement, this is a big deal.”

In Delaware, where Activision Blizzard is incorporated, state corporate laws make CEOs such as Kotick, as well as board members, fiduciaries to the corporation, Alon-Beck explains. The role requires them to exercise duties of care and loyalty to shareholders and makes them liable for breaching those duties.

Under federal securities laws, liability can arise if a “material” disclosure is omitted — though “materiality” has no clear and consistent definition, Chia said.

“You could have a claim that the CEO and or the board breached their fiduciary duty because they failed to monitor what was going on at the company, from a compliance point of view on sexual misconduct,” Chia says.

In August, shareholders filed one such suit, claiming Activision failed to inform investors that California’s Department of Fair Housing and Employment had been looking into claims of discrimination and sexual harassment, prior to the agency's lawsuit filed that month.

Several hundred Activision Blizzard employees stage a walkout which they say is in a response from company leadership to a lawsuit highlighting alleged harassment, inequality, and more within the company outside the gate at Activision Blizzard headquarters on Wednesday, July 28, 2021 in Irvine, CA.

 (Allen J. Schaben / Los Angeles Times via Getty Images)

Still, requiring a CEO of a large public company to report each and every instance of misconduct to the board is not likely a standard a court would impose, Chia said. However, he added, major allegations such as rape, and patterns of sexual misconduct claims, should indeed go that far up the chain of command.

For Alton-Beck, reporting significant events just to the board isn’t far enough as a strategy to protect against modern legal claims. Shareholders, she suspects, are going to have to be part of the equation.

Delaware state law requires board members to exercise oversight to avoid potential illegal conduct, she explains. In turn, the board should ensure that systems are in place within the company to help prevent illegal sexual misconduct and to learn about and investigate them, if they occur.

“If the court finds that [Activision] breached the duty of loyalty because they didn't exercise oversight, then they need to answer for the harm that they caused the corporation,” she says. “To me, it's a clear-cut case that there's a violation of duty of loyalty here, if they failed to put a system in place.”

Yahoo Finance contacted Activision Blizzard to obtain information about its oversight policies but did not receive a comment before publication.

Shares of Activision Blizzard (ATVI) were trading at $62.50 at market close on Friday, approximately 60% down from their 52-week high of $104.53.

Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.

Activision Blizzard’s Labor Woes Grow on Union Complaint to NLRB

Josh Eidelson
Tue, September 14, 2021


(Bloomberg) -- A union has filed a federal labor board complaint against Activision Blizzard Inc., opening a new front in the legal battle over workplace rights at the video game maker.

The U.S. National Labor Relations Board complaint, filed by the Communications Workers of America, accuses Activision of violating federal labor law through coercive rules, actions and statements.

“The employer has threatened employees that they cannot talk about or communicate about wages, hours and working conditions,” according to a copy of the complaint obtained through a public information request. The document also accuses Activision of illegally telling staff they can’t discuss ongoing investigations; threatening or disciplining employees because of their activism; deploying surveillance and interrogations targeting legally protected activism; and maintaining a social media policy that infringes on workers’ rights.

The agency’s docket shows that CWA’s complaint was filed Sept. 10. Activision didn’t reply to requests for comment Tuesday.

Activision Blizzard, which creates games like Call of Duty and World of Warcraft, is embroiled in controversy over its treatment of employees. California’s Department of Fair Employment and Housing sued Activision in July, alleging the company fostered a “frat boy” culture in which female employees were subjected to sexual harassment, pay inequality and retaliation. Days later, an employee walkout drew hundreds of demonstrators to the sidewalks of the company’s corporate campus in Southern California.

In a July email to employees, Activision’s chief compliance officer, who served as Homeland Security Advisor to President George W. Bush, called the California agency’s claims “factually incorrect, old and out of context.” Activision has also said that the picture painted in the lawsuit “is not the Blizzard workplace of today” and that the company values diversity and strives to “foster a workplace that offers inclusivity for everyone.”

Complaints filed with the labor board are investigated by regional offices and, if found to have merit and not settled, can be prosecuted by the agency’s general counsel and heard by administrative law judges. The rulings can be appealed to NLRB members in Washington, D.C., and from there to federal court. The agency can require remedies such as posting of notices and reversals of policies or punishments, but has no authority to impose punitive damages.

CWA, which has increasingly focused in recent years on organizing non-union video game and tech workers, said in an emailed statement that it was “very inspired by the bravery” of Activision employees and that it filed with the labor board to ensure that violations by the company “will not go unanswered.”

Activision Blizzard workers accuse company of violating federal labor law

Jon Fingas
·Weekend Editor
Tue, September 14, 2021


Activision Blizzard is facing still more legal action over its labor practices. As Game Developer reports, Activision Blizzard workers and the Communication Workers of America have filed a complaint with the National Labor Relations Board accusing the game developer of using coercion (such as threats) and interrogation. While the filing doesn't detail the behavior, the employee group ABetterABK claimed Activision Blizzard tried to intimidate staff talking about forced arbitration for disputes.

Companies sometimes include employment clauses requiring arbitration in place of lawsuits. The approach typically favors businesses as arbitrations are often quicker than lawsuits, deny access to class actions and, most importantly, keep matters private. Work disputes are less likely to reach the public eye and prompt systemic change. Tech firms like Microsoft have ended arbitration for sexual harassment claims precisely to make sure those disputes are transparent and prevent harassers from going unchecked.

It's not clear how Activision Blizzard intends to respond. We've asked the company about the complaint. The NLRB has yet to say if it will take up the case.

The gaming giant has taken some action in response to California's sexual harassment lawsuit, dismissing three senior designers and a Blizzard president after they were referenced in the case. It has so far been reluctant to discuss structural changes, though. The NLRB complaint might intensify the pressure for reform, and certainly won't help Activision Blizzard's image.



Activision Blizzard Hires Disney’s Julie Hodges as HR Chief in Wake of Sex Harassment Scandal

Todd Spangler
Tue, September 14, 2021



Activision Blizzard has hired Julie Hodges, a 32-year veteran of the Walt Disney Co., as its chief people officer.

Hodges joins the games giant effective Sept. 21, replacing Claudine Naughton, whom Activision Blizzard said is “leaving the company.” The change in HR leadership at the company comes two months after it was hit with a lawsuit from the California Department of Fair Employment and Housing, alleging that Activision Blizzard allowed a “pervasive frat boy workplace culture” to thrive that resulted in women employees being continuously subjected to sexual harassment and being paid less than men.

Other senior execs who have exited Activision Blizzard in the wake of the lawsuit included Blizzard Entertainment president J. Allen Brack, who was named in the California DFEH complaint as among company leaders who were allegedly aware of the misconduct and — despite repeatedly being informed of the problems — “failed to take effective remedial measures in response to these complaints.”

In announcing Hodges’ hire, Activision Blizzard CEO Bobby Kotick said that “Julie is the seasoned leader we need to ensure we are the most inspiring, equitable and emulated entertainment company in the world.”

Meanwhile, on Sept. 10, the Communications Workers of America’s Campaign to Organize Digital Employees (CODE-CWA) filed a complaint with the National Labor Relations Board against Activision Blizzard on behalf of company employees, alleging it illegally used “coercive tactics” to try to prevent workers from organizing a union following the California DFEH lawsuit, per Protocol.

In addition, Activision Blizzard on Tuesday said Sandeep Dube, formerly SVP of revenue management at Delta Airlines, will become chief commercial officer, effective Sept. 27. He is filling the role left vacant after Armin Zerza was promoted to CFO earlier this year.

“These two outstanding leaders from companies with exceptional reputations will help us achieve our goal of becoming the best company to work for in the entertainment industry while growing our reach, engagement and player investment,” Kotick commented.

In her 32 years at Disney, Hodges led HR for Walt Disney Parks and Resorts, the company’s Talent Acquisition Center of Excellence, HRBP for Worldwide Operations, and Disney University/Learning and Development, Organization Development and Cast Research. Hodges earned a bachelor’s degree from the University of North Carolina in Chapel Hill.

At Activision Blizzard, Hodges will be responsible for the company’s global talent organization, with the mission of making the company “the destination for top talent.” In her role, she will lead all aspects of human resources, including diversity, equity and inclusion, talent acquisition, employee experience, learning and development, compensation and benefits, and workforce planning.

A group of Activision Blizzard workers is unionizing

Kris Holt
·Contributing Writer
Fri, January 21, 2022


Call of Duty: Warzone quality assurance workers at Activision Blizzard studio Raven Software have announced plans to unionize with the Communication Workers of America (CWA). They have asked the company to voluntarily recognize their group, which is called the Game Workers Alliance. The 34-person unit had the support of 78 percent of eligible workers, according to Polygon.

“We ask that Activision Blizzard management respect Raven QA workers by voluntarily recognizing CWA’s representation without hesitation,” CWA secretary-treasurer Sara Steffens said in a statement. “A collective bargaining agreement will give Raven QA employees a voice at work, improving the games they produce and making the company stronger. Voluntary recognition is the rational way forward.”

Workers have given Activision Blizzard until January 25th to respond to their request, according to The Washington Post. If the company fails to do so, the group will file for a union election through the National Labor Relations Board and, because the workers have a supermajority of votes, they'd be able to formalize the union without voluntary recognition from Activision Blizzard. Should the group approve the union in an election, the company would need to bargain with workers in good faith.

Sixty Raven workers went on strike in early December after Activision Blizzard laid off 12 QA contractors, despite a request from Raven leadership to keep them employed. The workers demanded the company convert all Raven QA contractors into full-time employees. So far, Activision Blizzard has reportedly been playing hardball and declining to meet with with the striking workers. Warzone players have been grousing about the game's bugs, which QA workers are tasked with finding and addressing.

"Activision Blizzard is carefully reviewing the request for voluntary recognition from the CWA, which seeks to organize around three dozen of the company’s nearly 10,000 employees," the company told Polygon. "While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union." It added that it has raised minimum pay for Raven employees by 41 percent over the last few years, extended paid time off and converted over 60 percent of the studio's contractors into employees.

The CWA claims Activision Blizzard has "used surveillance and intimidation tactics, including hiring notorious union busters, to silence workers.” Last July, the company hired WilmerHale, a law firm with a history of cracking down on unionization efforts, to review its HR policies.

The Game Workers Alliance said its principles include solidarity, equity, diversity, transparency and sustainability. "Shortened development timelines sacrifice project quality and damage the mental and physical health of our team," it wrote on Twitter. "'Crunch' is not healthy for any product, worker, or company."

Earlier this week, Microsoft announced an agreement to buy Activision Blizzard for $68.7 billion, the biggest deal in video game history. If shareholders and regulators approve the acquisition, which could have enormous ramifications for the industry, the merger should close by June 2023.

In an interview with the Post on Thursday, Microsoft Gaming CEO Phil Spencer noted that he didn't have much experience with unions personally after working at Microsoft for over three decades. “So I’m not going to try to come across as an expert on this, but I’ll say we’ll be having conversations about what empowers them to do their best work, which as you can imagine in a creative industry, is the most important thing for us," he said.

On Wednesday, Activision Blizzard said in a Securities and Exchange Commission filing regarding the planned merger that, "To the knowledge of the company, there are no pending activities or proceedings of any labor union, trade union, works council or any similar labor organization to organize any employees of the company or any of its subsidiaries with regard to their employment with the company or any of its subsidiaries." The week that Raven workers went on strike, Activision Blizzard sent its employees a letter imploring them “to consider the consequences” of signing union cards.

As Bloomberg's Jason Schreier noted, the Game Workers Alliance is the first union within a AAA gaming company in North America. Last month, workers at Vodeo Games formed the first video game union in the US. Management at the indie studio voluntarily recognized Vodeo Workers United. Swedish publisher Paradox Interactive signed a collective bargaining agreement with unions in 2020, while Japanese–Korean publisher Nexon recognized a workers' union in 2018.

Activision Employee Group Forms Union, a First in Video Games

Jason Schreier
Fri, January 21, 2022

(Bloomberg) -- Microsoft Corp.’s planned acquisition of Activision Blizzard Inc. will come with an unexpected and perhaps unwelcome addition: a small group of unionized workers.

About three dozen people who work for an Activision-owned studio agreed to form the Game Workers Alliance Union, representatives for the group said Friday. They asked Activision to voluntarily recognize their union status. It would be the first union at a publicly traded video game publisher.

The group is composed of 34 quality assurance testers at Activision’s Raven Software, a team responsible for ensuring new content for Call of Duty games runs smoothly and without errors. It’s part of the Communications Workers of America, the largest union in the media industry.

A spokesman for Activision said the company is reviewing the request for recognition. “While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union,” the spokesman said in an emailed statement.

For years, people from across the video game industry have proposed organizing as a solution to unhealthy work environments. Burnout is a prevalent issue in gaming, brought on by a culture of overwork, sexism and little job security. Employers have not embraced workers’ flirtations with unionizing, but last month, employees of a small independent studio called Vodeo Games became the first to organize in North America.

Activision has been mired in scandal since California sued the company last summer for claims of sexual harassment and discrimination. Workers at the company began handing out union cards last month, triggering a warning from management that employees should “take time to consider the consequences of your signature on the binding legal document presented to you.”

Workers at Activision’s Raven Software went on strikes starting Dec. 6 in protest of the company’s intent to dismiss a dozen contract testers. Quality assurance testers are generally paid the least of any game developers and are sometimes treated as disposable. At Raven, testers are frequently asked to work overtime and have talked of going nights and weekends for months straight.

The Activision spokesman said the company has over the past couple of years raised minimum compensation for Raven testers by 41%, extended paid time off and expanded medical benefits access to workers and their spouses.

Microsoft said this week that it will acquire Activision for $68.7 billion. Unionization at big tech companies like Microsoft is rare. When a 38-person group of Microsoft bug testers organized in 2014, the company eventually dismissed them.

Management at Activision hasn’t acknowledged the Raven strike or responded to specific requests from the workers, representatives for the Game Workers Alliance Union said.

“It’s extremely important that workers have a real seat at the table to positively shape the company going forward,” Brent Reel, quality assurance lead at Raven, said in a statement.

Raven Software testers at Activision Blizzard form the first union at a major US gaming company



Amanda Silberling
Fri, January 21, 2022

Today, Raven Software's quality assurance (QA) department -- which mostly works on "Call of Duty" as part of Activision Blizzard -- became the first union to form at a major U.S. gaming company. With help from the Communications Workers of America (CWA), Raven Software testers launched the Game Workers Alliance, which plans to focus on "improving the conditions of workers in the video game industry by making it a more sustainable, equitable place where transparency is paramount," even beyond its own company. The 34-worker unit is asking management to recognize their union during a time already marked by change: on Tuesday, Microsoft acquired Activision Blizzard for $68.7 billion in one of the priciest tech acquisitions of all time.

Why Microsoft’s $2T+ market cap makes its $68B Activision buy a cheap bet

But on the heels of that historic acquisition, Activision Blizzard has been embroiled in controversy amid ongoing SEC investigations and sexual harassment scandals. Internally, employees started laying a grassroots foundation for worker solidarity through groups like the ABK Workers Alliance. When Raven Software laid off 12 contractors in early December, the team at the Wisconsin-based studio staged a walkout, which has continued for five weeks and counting.

Raven Software QA tester Onah Rongstad told TechCrunch that this incident sparked discussions about unionizing.

"On December 3, about a third of my department was informed that their contracts were going to be terminated early. And this was coming off of a five-week stretch of overtime, consistent work," she said. "We realized in that moment that our day-to-day work and our crucial role in the games industry as QA was not being taken into consideration. And at that time, we decided as Raven QA to start a strike to demonstrate that we are not just disposable parts of the industry, and during that time, it became very apparent that we had majority support within our department for a union."

The ABK Workers Alliance used its sizable social media following to crowdfund over $370,000 to assist with wages during the strike. The CWA said that this strike was the third work stoppage at Activision Blizzard after the company was sued in July 2021 over sexual harassment and misconduct claims. Still, about 20 members of the department remain on strike, Rongstad told TechCrunch.

"We are not sure how long [the strike] will continue, because we have not had direct communication with leadership about our demand that the 12 individuals who were let go be reinstated, which is unfortunate," said Rongstad, who has been with Raven Software since September 2020. "We are hoping to be able to go through with our unionization and get voluntary recognition so that we can prevent something like this from happening in the future."

Rongstad added that the news of Microsoft's planned acquisition does not change the union's plans to seek recognition.

"At the end of the day, we want to be able to work with leadership to create the most positive and beneficial work environment for all of the workers at ABK, and we are happy to work with leadership, whether that is the current leadership or Microsoft leadership in the future," they told TechCrunch.

This level of organizing among workers has little precedent in gaming, despite the industry being notorious for over-working employees or deploying mass layoffs due to closing studios. But only a month ago did the first voluntarily recognized gaming union form in North America at the small indie studio Vodeo Games, which produces "Beast Breaker." Vodeo's union also works with the CWA.

In an emailed statement to TechCrunch, Activision Blizzard responded to the Game Workers Alliance's announcement:

Activision Blizzard is carefully reviewing the request for voluntary recognition from the CWA, which seeks to organize around three dozen of the company’s nearly 10,000 employees. While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union.

Across Activision Blizzard, we remain focused on listening closely to our employees and providing the improved pay, benefits and professional opportunities needed to attract and retain the world’s best talent. Over the past couple of years, this has included raising minimum compensation for Raven QA employees by 41%, extending paid time off, expanding access to medical benefits for employees and significant others, and transitioning more than 60% of temporary Raven QA staff into full-time employees.

It's yet to be seen whether or not Activision Blizzard will voluntarily recognize the Game Workers Alliance. If Activision Blizzard chooses to recognize the union, then they don't need to have a union election and can begin collective bargaining. If the company opts not to recognize them, then the union can conduct an election through the National Labor Relations Board.

"We do have supermajority, and that's why we were able to ask for voluntary recognition. We're confident that if it went to a vote, we would win," said Rongstad. "We are hoping that they will voluntarily recognize the union and just show their support for workers rights."

The Game Workers Alliance is giving Activision Blizzard until January 25 to respond to their request for voluntary recognition. Read their letter below:

View this document on Scribd

Microsoft to buy Activision Blizzard for $68.7 billion

Activision Blizzard workers will stage a walkout after ‘abhorrent’ response to harassment suit

Workers at Activision Blizzard-owned game studio Raven Software vote to unionize

Jaimie Ding
Fri, January 21, 2022

Workers at Raven Software, maker of "Call of Duty: Modern Warfare 3" and other video games, have voted to unionize. (Associated Press)

After weeks of striking, quality assurance workers at Activision Blizzard-owned game studio Raven Software have voted to form a new union, adding a wrinkle to Microsoft's $69-billion acquisition of the video game giant.

Workers at the Wisconsin-based studio that leads development of the popular game “Call of Duty” are launching the Game Workers Alliance with Communications Workers of America. The quality assurance unit consists of 34 workers, 27 of whom voted to publicly support the union.

“In the video game industry, specifically Raven QA, people are passionate about their jobs and the content they are creating,” Becka Aigner, a Raven QA functional tester, said in a press release. “We want to make sure that the passion from these workers is accurately reflected in our workplace and the content we make.”

More than 60 workers walked off the job at Raven Software and across the 10,000-employee company headquartered in Santa Monica in early December to protest the dismissal of several members of the quality assurance department at the end of their contracts. The strike has been running for five weeks.

Jessica Gonzalez, a former Activision employee and organizer with worker group A Better ABK, called the news a “huge step” for labor organizing in the games industry.

“The first-ever blockbuster studio to unionize, it’s a big deal,” Gonzalez said.

Worker unrest has been stirring at Activision Blizzard for months. California’s Department of Fair Employment and Housing filed a lawsuit against the firm last summer, alleging that senior leaders allowed sexual harassment and pay discrimination to continue unchecked throughout the company for years.

In the wake of the lawsuit, workers at the company formed A Better ABK to press for better conditions and worker representation at Activision Blizzard and its King unit, maker of popular mobile games such as "Candy Crush."

A Wall Street Journal investigation in November showed that Activision Blizzard Chief Executive Bobby Kotick knew about sexual harassment allegations for years. Nearly a fifth of the firm’s staffers signed a petition and a walkout was organized to call for Kotick’s resignation.

Workers across the video game industry have increasingly been pushing back against work conditions that include temporary contracts with minimal job security and brutal weeks-long pushes to meet game deadlines. In December, about a dozen workers at the independent game developer Vodeo Games formed the first video game studio union in North America.

Friday’s news comes on the heels of Tuesday's announcement that Microsoft would be purchasing Activision Blizzard for $68.7 billion, the largest acquisition in the software company’s history. Some employees expressed unhappiness that the deal could represent a soft exit for Kotick, who stands to walk away with hundreds of millions of dollars.

Microsoft, like most of the tech industry, is not unionized, though temporary employees at the contractor Lionbridge Technologies signed a union contract with the company in 2016. Some Microsoft workers in South Korea and Britain are also part of unions.

Microsoft Gaming Chief Executive Phil Spencer told the Washington Post on Thursday that he doesn't "have a lot of personal experience with unions."

"I’ve been at Microsoft for 33 years," Spencer said. "So I’m not going to try to come across as an expert on this, but I’ll say we’ll be having conversations about what empowers them to do their best work, which as you can imagine in a creative industry, is the most important thing for us.”

The newly formed Game Workers Alliance requested voluntary recognition from Activision Blizzard but will move forward with a balloted election through the National Labor Relations Board if they do not receive a response by Tuesday.

“A collective bargaining agreement will give Raven QA employees a voice at work, improving the games they produce and making the company stronger," CWA Secretary-Treasurer Sara Steffens said in the press release. "Voluntary recognition is the rational way forward.”

The Game Workers Alliance also accused the company of "surveillance and intimidation tactics," including hiring union busters to silence workers.

An Activision Blizzard spokesperson said the company is “carefully reviewing” the request for voluntary recognition from CWA.

“While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union,” the spokesperson said.

The company said it has raised minimum compensation for Raven QA employees by 41%, extended paid time off, expanded access to medical benefits and transitioned more than 60% of temporary QA staff into full-time employees.

This story originally appeared in Los Angeles Times.