Since its merger with with Blizzard, under the giant banner of entertainment conglomerate Vivendi, Activision has laid claim to being the biggest commercial publisher of video games in the world. Whilst having a studio like Blizzard on board is undoubtedly a boon for any publisher, the core company has basked in a great deal of success in recent years, making the most of existing IP such as Call of Duty and developing new brands such as Guitar Hero.
More recently, along with most of the rest of the industry, Activision has begun to feel the pinch. In February the company underwent a 'refocusing', canning several projects to focus on big earners and closing or downsizing a number of studios. A combination of success and unpopular decisions like these has seen Activision take on something of a Machiavellian reputation - consuming studios and series for blind profit.
However, that reputation is undeserved, says developer relations head Dan Winters. Activision is the same studio it was when it was a plucky underdog not so long ago. Read on for an insight into Activision's self-perception, its plans for digital distribution and the potential resurrection of a familiar series.
Q:You're talking at the Festival of Games later this month - can you tell us a little bit about it?
Dan Winters:My goal is to try and share some of my various experiences over the last few years. I've been in the business for pushing on twenty years now. My goal is to try and share some of my misspent youth and explain how that has led me to, I guess a broad perspective and a healthy respect for the development community - the ability to have people pitch their ideas and themselves.
Q:So is it aimed at helping developers how to pitch or publishers to know what to look out for?
Dan Winters:Primarily to help developers understand the mechanics of a successful pitch to publishers. I think that part of that comes from a healthy respect for how much bravery it takes just to put your ideas out there in the first place. Along with performance and the various things that I've learned over the years by being in different businesses - I was an actor for a number of years, a baseball player for a number of years, I worked for the Walt Disney company too, I have a more than healthy respect for the creative process.
I've also done a pretty good job, I think, of fine-tuning the art of the pitch itself. So I'd like to share some of the things I've learned along the way.
Q:I see that a representative from Unity is also giving a similar presentation - are you presenting to the same people, do you think, or is a good pitch to Activision different from a good pitch to Unity?
Dan Winters:I don't profess to believe I have all the right ideas! I just want to share my experience and knowledge, my personal perspective. I'm not saying - 'this is how you should pitch', I'm just saying that these are things that have worked, whether if I've been the one pitching or if someone's been pitching to me. There are ten tentpole ideas that I'll share which should give people an idea of what has worked before.
It maybe a little bit different for them individually, they put their own style on things. Personalisation and passion are two very important things - one's ability to convey your ideas. So, it's strictly my experience about what has worked, there may be fifteen other things that have been effective for other people along the way, but I have a limited amount of time. But I'm not at the point where I think that the ideas that I'm going to communicate are the only ideas out there.
Our model has always been the same, which is that we have a completely healthy respect for the independent development community.
I'm not really talking about Activision, either. I'm really trying to share ideas that are more broadly of benefit to the development community or anyone who is trying to pitch an idea or selll themselves.
Q:So what does your day-to-day role include? I presume that it's a bit more complex than you sat behind a desk saying either yes or no?
Dan Winters:I think that I shepherd ideas. So whether it's me or someone at another publisher or at a film studio, there's usually an initial filter. I guess for Activision I would be one of those filters, any new idea or pitch that comes into Activision, I get my eyeballs on at some point. The idea is to try and give whoever your advocate is inside the company enough in their toolbelt so that they can put a package together which will not only be compelling to themselves but also to other people in that organisation who are going to be the stakeholders in that organisation.
That's another thing that I hope to share: one of those things in that toolbelt which you can provide is someone on the organisation so that they can be an advocate and, I guess, share your idea almost as effectively as the person generating the idea in the first place.
Q:Yours is a job which seems like it would be evolving quite quickly at the moment, with a changing focus. Did the recent round of cuts and the refocusing of Activision represent a change of policy in terms of the way Activision deals with internal and independent studios?
Dan Winters:Well, at any time we have anywhere around ten or twelve internal studios. Our model has always been the same, which is that we have a completely healthy respect for the independent development community. Even when we bring someone into the family, like we did with Bizarre Creations or Freestyle games. Freestyle Games is not a concluded situation yet - we're still working hard to try and find the best opportunity for Freestyle, and they're an active member of that process.
For Bizarre we went through the same process, recently Martin (Chudley) was quoted in press, giving some little glimpse of what that process was. But our perspective hasn't changed at all on internal or external development. We understand that having talent is what wins. Talent is the real value in anything that we do.
There are great ideas that can be presented, but without the talent to execute to excellence, that idea is minimised, I think. So the situation with Bizarre and with Freestyle and our independent developers is more a result of the market than it is policy change. We still feel as confident with our development partners, and have just as much love for them as we did before, but the market has obviously changed for everyone. At the end of the day, we're a company that has to do right by the business and do right by our shareholders - we have to make very difficult decisions sometimes.
Recently we've had to make some of those decisions based on market conditions, but not because of policy change.
Q:In the last few days or so, Freestyle Games actually registered a ninety day notice period - which looks a little bit ominous in terms of their ongoing survival. Is that something you can comment on?
Dan Winters:It's an ongoing process. That was activated a few days ago - it's something we've been working on with them for a little bit of time. That's a period of time where we can figure out what the best path is with Freestyle Games. That isn't a decision made by Activision unilaterally. It's completely a collaboration between those two parties. We're still working through that process.
Q:What about future acquisitions going forward - are those off the cards for now?
Dan Winters:Not at all. There are key targets and development groups that we would love to work with, and also we're looking at unique development models. Our recent restructuring has us with a greater focus, we've got three big, tentpole titles that have a disproportionate amount of focus from our organisation. The Bungee opportunity that we have, Skylanders with Spyro, and Call of Duty.
We felt like that, right now, the market is kind of telling us it's very difficult to be a mid-tier product in the marketplace. The titles that are succeeding are very big titles, high quality titles. That seems to be capturing the attention of consumers. For that reason we decided to focus our attention and our business on making those opportunities as big as possible.
In addition to that we have taken a lot of our other products and created another business unit called the licensing business unit. That's being managed by a guy named Dave Oxford who's proven to have the kind of magic touch to take niche, really high-quality passionate type audiences and appeal to their sensibilities.
We have an entire portfolio dedicated to that audience as well. So that's a big part of our audience and a bit part of our slate. As a result if you look at where we are in the market, we also realise that we have to look for new business opportunities. We can't rely on the brands that we have on our slate. We have to look at new opportunities with development groups, with talented folks, and also with unique business models which we're not currently playing in right now.
Q:Activision has always been fairly adamant about not getting involved in things like social and casual gaming - Bobby Kotick has certainly been quoted as saying as much - is that something which you'll reconsider?
Dan Winters:I don't know. Bobby has proven, and we as a company have proven, that when there's the right opportunity, we're quick to move on it. I think Guitar Hero is a great example of that. I think that if someone had asked us, before we took on Guitar Hero, maybe six months before that, if we were thinking of taking on a peripheral-based music title, I bet you'd get a mixed answer on that. When that opportunity did present itself we were pretty quick to move on it. It turned out to be a pretty successful thing for the company.
I think that the console market is healthier than it's ever been, it's just a little bit more consolidated.
I think that one of the benefits of Activision is that we're very quick to move on opportunities when it's the right time and the right thing. We like to keep an open mind on anything, however I think that Bobby's been pretty clear that, up until now, he and the company haven't seen an opportunity in that space that's been worth it for us. That's probably not been where we're best applied with our energies. The point being that, if we're spinning our wheels on too many things at once, if we have too many numbers on that roulette wheel, then it becomes an opportunity cost against something else.
So our goal is to focus on what we're very good at already. To make those bigger opportunities. Then also to look aggressively for opportunities which could turn into those bigger opportunities later on.
Q:With that ongoing search for talent and opportunity, are you finding that there's a dearth of either at the moment? We're seeing a lot of high-profile talent bleed to social and casual, and a lot of the smaller studios which are rising from the ashes of closures are entering that market...
Dan Winters:Oh I don't think so. I think that the console market is healthier than it's ever been, it's just a little bit more consolidated. A lot of people, for various reasons, a lot friends who I've been in the business with for years, there are two things that work towards their desire to move into another space. One is that a lot of publishers started to rightsize their studios and a lot of really talented people found themselves scrambling for what their next move was going to be.
The other thing is that new business opportunities created an opportunity for people to have a balance of lifestyle that historically was not able to be the case for a lot of people. We come from a time where deadlines are a very critical part of the business. We work hard. We all work very hard. I think when people have been in the business for ten, fifteen, twenty years, their priorities shift a little bit. So, this is a balance of what kind of product people want to work on, the way that they want to reach different audiences. I think that the variety of ways of doing that is a real draw for people.
As a result, I think it's interesting. Social/casual has opened up a opportunity for people to take the experiences they've learned through the years in the console market, in the high production value world of 360/PS3, whatever that is, even film studio people coming over, and applying some mechanics, some analytic material, into making games for a broader, more casual audience. I think it's fantastic.
At the same time you've got a number of very talented people who remain working on very high production value material - and obviously with the bar being raised every single year because consumer expectation is higher, it keeps us kind of honest. Every year, Call of Duty is a better game than it was the year before. Bungie was making Halo every year. They were required to put additional quality into those products.
I think that's a really good thing for industry, there's a great deal of talent out there.
Q:What can you tell us about Beachhead? It seems like a sensible direction to take at least part of the Call of Duty franchise towards. Also it makes sense to explore new business models with a well-established IP. What are you looking at for that?
Dan Winters:We're exploring everything right now. The Beachhead group is really a group of investigation, exploration, trying to look at what business models could and should be pursued. We have a very large audience of people who have an appetite for really high quality content. They've got the challenge of trying to figure out how to deliver that content, and how to meet the appetites of the consumer, which we hold a lot of value in.
Those 25 or 30 million people who are playing Call of Duty online mean a lot to us. We consider them to be part of our family. We want to feed our family, so we want to feed that consumer as well. They're looking at various ways to do that.
Q:Is it going to be the primary focus of Activision's digital business going forward?
Dan Winters:I think it's safe to say that Digital distribution is fast coming up on the horizon, we are very strong in our retail business, our ability to move boxes, we're very confident in that region, but we also recognise that there are different ways to get content to people. Whether it be, down the road, cloud computing or digital distribution, these are all just additional roads for us I think, for getting content to the people who are part of our family.
That's certainly a part of it. We're still looking at ways to compliment what we're doing, or to create new pathways to reach folks. It's all still part of the exploration.
Q:Is there anything you can say about True Crime? Its cancellation was announced as part of the series of cuts which also saw the end of Guitar Hero...
Dan Winters:Actually, just to clarify, we're just putting Guitar Hero on hiatus, we're not ending it. We're releasing products out of the vault - we'll continue to sustain the channel, the brand won't go away. We're just not making a new one for next year, that's all.
Q:Presumably True Crime is definitely dead though? Activision was very candid in its assessment of the prospects for that game when it was cancelled, saying it simply wasn't going to be good enough to compete... It was obviously a long way through the development process, was it a decision to protect your reputation by cancelling a sub-par game or was it purely commercial in that it was expected not to make money?
Dan Winters:I think that it was a piece of both. We think that the game was tracking to be a very good game. The question was really the size of the prize based on how good it could be. We are confident that thing would of been eighty plus. Eighty five maybe. They're a really talented group at United Front. We were really confident that they were tracking towards a very good game. But...The challenges in the market place right now, when you're talking about open-world games that are going to compete with titles like Red Dead Redemption, expectations for the consumer are really high.
Actually, just to clarify, we're just putting Guitar Hero on hiatus, we're not ending it.
That would have been, and still might end up being, a very successful mid-tier opportunity for someone. But, as I said, we changed our business model to where we were going to change our business model to focus disproportionately on three big, huge monsters. Those three monsters are the Bungie, Call of Duty and Spyro titles.
So that left the True Crime title being a mid-tier opportunity which we felt was an opportunity cost against other things. But we have a lot of confidence in the quality of the studio and the quality of the title, just not in the scale of the opportunity.
Q:There's a certain perception of Activision, which you are no doubt working to dispel, of a sort of evil empire corporation which eats up studios for profit. As naive as it might be to expect any large company to look too far beyond making money, do you ever encounter any resistance from studios which you're trying to bring on board?
Dan Winters:I hope not. I would like to think that we spend a lot of time, and I individually spend a lot of time thinking of ways to reach out to the development community and show that we have respect and complete admiration for what they do on a daily basis. I hope that there aren't any hard feelings and I hope there isn't any reluctance - I've certainly not felt it directly.
A business is a tough thing to manage on a number of different fronts, especially when you're dealing with a creative community like video games or interactive entertainment. Any time that I do hear anything of concern I do try to dispel it. The overall message that I would love people to get out of any time they actually get detailed information about us or my personal approach is that we have admiration and respect for the talent in this industry.
We recognise that the success we've had as a company comes from the talent of those individuals and those teams. We would like to think that we're able to compliment that talent and high-quality product with the ability to move things through the right channels, and that's great, I think that's part of our magic sauce. But without really high quality product, and without the passion and talent behind it, we recognise that the business is only the business. I hope there's no reluctance, I certainly haven't felt it directly.
Q:The interview with the Bizarre staff was interesting in that it depicted the process as open and very much two-way, especially with staff being given the opportunity to buy the studio back. I think people were a little bit surprised by how good-natured it seemed to be.
Dan Winters:I'm sorry that people were surprised by that. With all of our internal studios we have built a process, Bobby has really done this directly himself, built a process for the independent developer model, that allows them to retain their own culture, their own visibility, their own leadership, really to drive the stewards of the brands. I think those are important pieces of ownership, as it's loosely defined.
I think that's an important part of people coming in and having a passion and being able to exercise that passion as opposed to going in and being called publisher's name plus location. That takes some of the individuality away from that studio, and maybe some of their ability to personalise, to put in passion and ownership into their studio process. So I think we've done a good job of that through the years.
It's interesting, before our merger with Blizzard, becoming the number one publisher from a revenue perspective, we were always known as the warm and cuddly Activision; the scrappy, loveable number 2. As soon as we become the number one and we develop broader perspectives, perceptions started to change a little bit.
We've worked very hard, and continue to do so, to let people know that, you know, we're the same guys, we really are. We haven't changed! I'm the same guy that I was before the merger, as are most of us. We're the same organisation. We haven't gone out and hired 3000 people. Our ability to scale and move quickly is the same as it was before. We're not this big, monolithic empire that's making decisions in a dark room, we're still very collaborative. We still have the same healthy respect and appreciation for talent that we ever did.
Q:It seems to be something of a Western foible, to support the underdog and somewhat romanticise that second place position. To think that, if you're winning, you must be doing something slightly underhand.
It's interesting, before our merger with Blizzard, becoming the number one publisher from a revenue perspective, we were always known as the warm and cuddly Activision.
Dan Winters:That's true. Nothing has really changed except that we have a bigger number and broader responsibility for more products, for more people. Not people we've gone out and hired, but more people playing our games. We went from being a very successful company, in fact in terms of the market share perspective we were teetering on the number one, number two before the merger and then we went to delivering 25 million copies of Call of Duty to consumers at a time when we had Blizzard expanding on the World of Warcraft front. There's a greater responsibility for a broader audience now.
That doesn't mean that we've changed our perspective at all. We have the same sensibility and we're still the same small town folks that we were before, just with a lot more work to do.
Q:Has there been much cultural bleed between Activision and Blizzard?
Dan Winters:Well we've learned a lot from them! That's for sure. They're really smart folks. They've learned not only how to stay committed to quality but how to sustain a community of people - and how they do that is, using virality and a consumer program that allows loyalty to be the primary driver to their product, and they respect that by delivering continued quality to their audience.
With Blizzcon, things like that, it's all about community and being part of that special club. We learned a lot from those guys. I'd like to think that there's a good collaboration on both sides of the coin, but I've gotta tell you, those guys are really wicked smart. Any time we get a chance to go over and pick their brain on anything, we certainly take advantage of that.
The facilities they have down there are special. They have built a home for their workforce that is unique and very personalised. The campus they have down there is not overblown by any means but it certainly feels like home. That creates a real special creative environment, to tie it back a little bit to the talk I'm going to give, I believe very strongly in a creative environment being a big part of everything we do, whether you're in finance or an artist or in business development, creative solutions are a big part of what we do on a daily basis. It also makes it a bit more interesting. If we have a tendency to try and figure out plenty of different ways to solve a problem, then we end of reaching out and broadening our perspective a great deal. I think that's a big part of how we create value.
Dan Winters is the head of developer relations at Activision. Interview by Dan Pearson.