Valued at $23B in 2015, the video game industry stands as a giant among giants in the American and international media markets (Morris, 2016). Through its complex history and economic structures, the industry creates a vast number of products each year in the form of new IPs and franchise expansions. A dominant player in the industry, perhaps one of the most dominant, is Activision Blizzard, which produces world-famous series such as Call of Duty and World of Warcraft (“About,” n.d.). Activision Blizzard developed its current corporate structure and earned its power through years of growth and production. Beginning of the Storm Before Activision Blizzard, there was Activision, founded by game designers David Crane and Alan Miller on October …show more content…
Since then, Activision Blizzard has grown to be the second most traded game company in the industry, churning out blockbuster titles that have redefined the gaming market (Takahashi, 2015b). Taking a hint from Hollywood, the use of blockbuster titles have helped to create brand recognition within the gaming industry, and has allowed companies to bank on reworks of previously developed titles. To do this most effectively, Activision Blizzard is broken down into 5 divisions—Activision, Blizzard Entertainment, Major League Gaming, Activision Blizzard Studios, and King Digital Entertainment—which allows them to divide and conquer in the industry. Additionally, they make use of an independent studio model, allowing them to own and operate additional studios to increase their portfolio (Takahashi, 2015b). This model allows the company to reach a larger audience through a diverse library of games. In doing so, they achieved the highest grossing entertainment launch of 2015 with the release of Call of Duty: Black Ops III (Hillier, 2016). By creating a system that had divided the company so that it could focus on different aspects of the gaming industry, Activision Blizzard is able to target different consumer groups through a large selection of
The Walt Disney Company and Pixar Animation Studios Inc. were two of the largest movie and entertainment studios. Disney owned and operated an unparalleled portfolio of theme parks classic movies and characters. Pixar was the leading creative and technological computer generated imagery (CGI) studio but lacked extensive product offerings and distribution channels. At the time of the merger agreement, Disney’s traditional hand-drawn animation films were declining in popularity with the introduction of CGI films. Meanwhile, Pixar possessed the creative and technical resources that Disney lacked, but was unable to profit from characters and films after movie ticket and DVD sales, which were typically one-time purchases. Additionally, the production and distribution contract between Pixar and Disney was rapidly approaching its expiration. Instead of renewing the contract, the two companies decided to merge with the intention of capitalizing on ...
The Walt Disney Company is a highly diversified media and entertainment company that has been growing by leaps and bounds since its inception in the late 1920’s. In the past few decades, The Walt Disney Company has expanded into numerous markets and diversified its business greatly. The company states that their corporate strategy is targeted at creating high-quality family content, exploiting technological innovations to make entertainment experiences more memorable, and expanding internationally. Upon studying the happenings of the company throughout the years, it is easy to see that the company is executing this strategy well through numerous strategic moves in the industry.
It allows opportunities to combine the performance of certain activities, thereby reducing costs and capturing economies of scope. This is done by acquiring IP that is underexploited or unused by the owner. They have opportunities to transfer their skills, technology, or intellectual capital from on business to another. This is yet again done through media networks, parks and resorts, and also their studio entertainment. All of which allow them to go globally. Along with the opportunity to transfer skills and technology, they can use their brand name across multiple product or service categories. This is seen in the multiple IP networks, studio entertainment, multiple resorts and parks that are all around the world, and lastly, in their consumer products that were ranked number one in 2011 for being the largest licensor of character-based merchandise in the world. Value chain match-ups seen in primary activities are inbound logistics, operations, outbound logistics, the marketing/sales, and service. All lead to support activities such as technology, human resources, and general administration. Opportunities for skills transfer is seen in the media networks, parks and resorts,studio entertainment, and consumer products. Disney Company can share iconic Marvel characters in their parks/resorts, movies, and consumer products, due to buying the IP to Marvel and it does not stop at just Marvel ABC and ESPN are also involved.
Key Changes in the Video Game Industry The first wave of home video games was launched nearly 30 years ago. By the early 1980s, this electronic entertainment medium had emerged as a cultural phenomenon, thanks to classics such as Asteroids, Centipede, Donkey Kong, and Pac-Man. The world of video games has, of course, changed drastically since then. For starters, Microsoft, Nintendo, and Sony are now the key players in the console industry, having replaced Atari, Coleco, and Mattel for those top spots. Advances in technology are making game worlds more realistic and interactive than ever before.
Disney’s long-run success is mainly due to creating value through diversification. Their corporate strategies (primarily under CEO Eisner) include three dimensions: horizontal and geographic expansion as well as vertical integration. Disney is a prime example of how to achieve long-run success through the choices of business, the choice of how many activities to undertake, the choice of how many businesses to be in, the choice of how to manage a portfolio of businesses and the choice of how to create synergies between those businesses (3, p.191-221). All these choices and decisions are made through Disney’s corporate strategies and enabled them to reach long-term success. One will discuss Disney’s long-run success through a general approach. Eisner’s turnaround of the company and his specific implications/strategies will be examined in detail in part II. Disney could reach long-run success mainly through the creation of value due to diversification and the management and fostering of creativity, brand image and synergies between businesses (1, p.11-14).
The video games industry faces an entirely new rivalry situation. After 11 years of leadership, Sony has nearly lost its strong positions on the market, which gives the other two players – Microsoft and Nintendo - the chance to compete for the leadership. While the goal of Nintendo is to stay in the industry, Sony and Microsoft aim to strengthen their positions on the home entertainment market, which is constantly growing. The key factors, the companies need to consider in order to gain a competitive advantage, are good marketing and well developed distribution, as well as providing a huge range of games with recognizable characters. As the market segmentation increases, it is of crucial importance to put an emphasis upon the new target groups and reqruit as many new players as possible. However, there are also a lot of factors outside and inside the industry, which play a major role and have to be considered in order to become a better idea of the state of the industry, and to estimate its profitability and tendency of growing.
Bungie Inc. is a video game development company headquartered in Washington. Since its inception, Bungie Inc. has been focusing on developing role playing games which captivate the youth, giving them a sense of living the game. Bungie Inc. was instrumental in the development of the video game franchise “Halo”, which proved to be a blockbuster, after being acquired by Microsoft. Games like Pathways into Darkness, Marathon, helped establish Bungie Inc. as a force to reckon with in the gaming industry. Early in 2007, after the success of the
Xbox is a technological product which is comprised of many electronic components. The cost of switching between suppliers can be very high as the major suppliers of the XBOX components are the global technology giants like IBM, Samsung, Delta Electronics, ATI Radeon and FOXCONN etc. Additionally, Xbox carries a powerful brand name. Therefore, the bargaining power of suppliers for Xbox is high.
Have you ever wondered how much money these guys make? Well let’s take Call of Duty Modern Warfare 2. It took about 200 million dollars to produce and they sold 500 million dollars’ worth of copies. Take 500 million and subtract 200 million, 500 subtracted by 200 and that equals 300, and you get a profit of 300 million dollars! They made a lot of money and because of that they created a lot of other games.
The company is able to do this through its Publishing and Retail business. The company markets its products through its retail stores, including the Disney Store. Finally, its last segment is its Interactive segment. The Disney Interactive segment’s primary objective is to produce and operate interactive Games that is developed for consumers to play on mobile and console devices, and to visit virtual worlds (Walt Disney Co). The company employs approximately 175,000 people as of September 2013, and are known as a leading diversified global family entertainment company (Walt Disney
INTRODUCTION In 2013, nearly a billion people worldwide carried a gaming device around with them in their pockets everywhere they went – their smartphone. Over 250 million people, from grandpas, to football fans, to office workers, children’s were playing games against each other each month – online. Sony Corporation is one of the largest consumer electronics manufacturers company in the world. One of the most profitable product of Sony corporation is the video game console .In
In 1995 Electronic Arts acquired Bullfrog, a British game developer studio that focused primarily on PC games and had hit games like Theme Park and Populous (Robinson, 2008). Once acquired, Electronic Arts tried to conform bullfrog to EA’s way of operating by smothering them instead of letting Bullfrog continue to operate the way they have been successful in the past. This strategy proved to be ineffective. Conforming Bullfrog changed the culture of who they were as a company. The owner of Bullfrog at the time said, “There was a bit of tension between EA and Bullfrog because of the different cultures (Higgins, 2016).”
Griliopoulos, Dan. "The State of Indie Gaming." TechRadar. Future, 12 Nov. 2012. Web. 21 Mar. 2014. .
Blizzard Entertainment is an American game developer and publisher. The company was established in 1991 under the name Silicone & Synapse, by three friends Allen Adham, Michael Morhaime and Frank Pearce, who shared love for gaming. First publishing of the company included creating entertainment software for variety of platforms like MS-DOS, Macintosh, Sega Genesis, and Super NES.
This is where I automatically knew that the topic of video games would strongly appeal to the class full of technology majors. As mentioned, the biggest games of the year comes out this month. The popular first person shooter, Call of Duty: Black Ops 3, and the long awaited, Fallout 4. Personally, I am neither a fan of both of the games, merely because I do not have any experience with them. However, I have viewed game play for both games, and I am intrigued by how much the video game industry has progressed in technology. The visuals are difficult to compare with reality. It is out of the question that Call of Duty and Fallout 4 will received positive ratings. They have already made millions of dollars in profit within their first week of launch. It is pointed out clearly why this topic was easily conversed during the discussion. With so much attention on the games, I may be eventually drawn into going into GameStop and purchase one of the two widespread