Activision Down, Vivendi Waaay Up

Gamespot is reporting that Activision faces delisting from NASDAQ due to non-compliance. They failed to report their quarterly earnings on time, a situation the company says they will correct as soon as 'practicable.' Meanwhile, Vivendi earnings are up 190% No, that's not a typo. Two guesses as to why. From the article: "Unsurprisingly, Vivendi Games attributed the profit spike largely due to what it describes as 'the higher margin of the World of Warcraft business.' It also cited other factors, including the start-up investments for the Sierra Online and Vivendi Games Mobile divisions and strong sales of Scarface: The World Is Yours in October." Translation: "We have a money hat machine! Yay!"

No big mystery...

[Anonymous Coward]

When a game studio is young, it attracts hot, young talents who are willing to put all of their passion into the work. They go for a while releasing cool, cutting edge titles, sometimes at the cost of other parts of their lives (or other parts of the business).

As the studio grows, the other business realities start to take hold. The founders and other talent brought on board earlier in the life of the company often get a little burnt out and leave, or in the case of a merger/aquisition, the new management doesn't jive with the old guard and the older employees leave to do their own thing, or their influence is marginalized.

In any event, any business, not just game studios, change as they go from a brand new start up to an "established" company. In the case of game companies, though, you often tend to lose your best and most passionate talents if you don't treat them extraordinarily well. Even if you do, turn over can really change the make up of your talent as time goes one.

Also, an "established" studio is less likely to take chances on new game play ideas since its primary function becomes one of sustainable profitability. A new development shop might be more likely to try new things. Not that they have less to lose, but in general a young company is more likely to take more chances.

Re:Woah!

[Anonymous Coward]

World of Warcraft makes well over 1 billion in revenue each year from subscriptions, box sales, merchandise, and paid services such as character transfer. There will also be a huge increase next year from the expansion release.