This Week in Business is our weekly recap column, a collection of stats and quotes from recent stories presented with a dash of opinion (sometimes more than a dash) and intended to shed light on various trends. Check back every Friday for a new entry.
I briefly considered making this week's column an even-handed examination of why Activision Blizzard should remove Bobby Kotick from the CEO position even if one were to believe he is making an honest and sincere effort to fix a broken system and culture he has presided over for decades.
Then I remembered that historically speaking, giving Kotick the benefit of the doubt has not been my strong suit, so we may as well spend another week poking holes in the company's transparently insincere response to all this.
But before we do that, let's first take a moment to recognize some people more deserving of that benefit.
Kotick is obscenely wealthy and runs a huge company that has been consistently profitable and shown tremendous growth in the past 15 years. He is as entrenched and insulated from consequence as it gets in this industry. And yet this week, his position atop Activision Blizzard and in the industry itself seems more precarious than ever before.
And the reason for that is because people without the resources or the legal team at Kotick's disposal refused to defer to that wealth and power. A partial list of people whose efforts have brought us to this point:
● The people who tipped off the California Department of Fair Employment and Housing and the Equal Employment Opportunity Commission
● The people who conducted those agencies' investigations over the course of years
● The victims of Activision Blizzard who cooperated with those investigations
● The victims of Activision Blizzard who told their stories to journalists
● Victims of countless other companies and abusers in gaming and beyond who have gone public in recent years, helping establish for everyone that that the treatment and behavior we've read about is not acceptable
● The people at the DFEH who opposed the EEOC's shamefully inadequate settlement to bury gender discrimination charges against the publisher
● The Activision Blizzard employees who have risked their jobs by pushing their employer from within
● The Activision Blizzard employees who have risked their jobs by organizing and engaging in walkouts
Precious few of these people stood to gain much personally from their actions. Anyone looking for a payday would likely be better served by hiring a lawyer and going it alone rather than banking on a slice of an eventual settlement for an entire class of victims, especially given how paltry those settlements might be.
Without the courage of these people, the odds of Activision Blizzard spontaneously deciding to materially improve its policies and practices were astronomical
Many of the people above took on an immense amount of risk for no benefit aside from a hope that justice could be done. That leap of faith should be applauded, because without the courage of everyone above, the odds of Activision Blizzard spontaneously deciding to materially improve its policies and practices were astronomical.
And now Kotick is embattled, at the very least. Press outlets like Polygon and Eurogamer are calling for his resignation, and even the platform holder that has paid for so much exclusive Call of Duty content over the years is telling Activision Blizzard to get its act together.
QUOTE | "[Activision] has not done enough to address a deep-seated culture of discrimination and harassment... We do not believe their statements of response properly address the situation." - PlayStation CEO Jim Ryan tells employees it is leaning on its third-party publishing partner to fix its mess.
Xbox head Phil Spencer likewise had some condemnation for Activision Blizzard, telling staffers the leadership team there was "disturbed and deeply troubled by the horrific events and actions" at the publisher and Xbox is "evaluating all aspects of our relationship with Activision Blizzard" as a result.
Kotick's own employees are increasingly bold in telling him to kick rocks.
QUOTE | "Today and always, we stand in support of women and all of our fellow coworkers at Activision Blizzard. We must build #ABetterABK." - Activision Blizzard's Toys For Bob studio expresses support for the hashtag of the ABK Workers Alliance, which called for the removal of Kotick this week.
STAT | 750 - The number of Activision Blizzard employees and contractors who signed a petition calling for Kotick's resignation within a couple hours of it going live.
Even now, in the middle of all this, it doesn't seem like Kotick has learned much. His reaction to this week's Wall Street Journal report was to have the company call it "misleading" and say it was "disappointed" that the outlet chose to ignore all the good stuff it has loudly said it is doing for months now instead of dwelling on reporting that sheds light on heretofore unknown despicable behavior the company and Kotick have never been made to answer for.
QUOTE | "The WSJ ignores important changes underway to make this the industry's most welcoming and inclusive workplace and it fails to account for the efforts of thousands of employees who work hard every day to live up to their -- and our -- values." - Activision Blizzard's official statement taking credit for the work of the people inside it trying to make it less awful.
That response was premised on attacking the messenger while denying the substance of the report, much like the company's initial reaction to the DFEH lawsuit.
QUOTE | "A recently filed lawsuit presented a distorted and untrue picture of our company, including factually incorrect, old, and out of context stories -- some from more than a decade ago. We cannot let egregious actions of others, and a truly meritless and irresponsible lawsuit, damage our culture of respect and equal opportunity for all employees." - An internal email to Activision Blizzard staff sent by Activision Blizzard executive VP of corporate affairs Fran Townsend in response to the DFEH lawsuit.
Of course nobody bought that, as 1,000 current and former Activision Blizzard staffers were outraged enough to co-sign a letter calling for Townsend to resign from her post as executive sponsor of the ABK Employee Women's Network.
Kotick then released a public statement under his own name, saying the company's initial response was "quite frankly, tone deaf."
It was a credibility-destroying 180 from the initial response. The company's initial denial fell apart almost instantly through public testimony and reporting backing up allegations in the DFEH lawsuit. And even if leadership had simply been ignorant to the scope of problems at the company, they would have received a thunderous wake-up call.
QUOTE | "We encourage anyone with an experience you believe violates our policies or in any way made you uncomfortable in the workplace to use any of our many existing channels for reporting or to reach out..." - Bobby Kotick in July, in a public statement that promised "swift action to be the compassionate, caring company you came to work for and to ensure a safe environment."
STAT | More than 500 - The number of reports Activision Blizzard has received from current and former employees about sexual harassment and other inappropriate behavior since July, according to the Wall Street Journal.
Activision Blizzard may have toned down its response to the Wall Street Journal report, but the problem now isn't the tone; it's that there's no reason to trust the company on these matters after its previous denial fell apart so spectacularly.
To the extent that Kotick believes there's a sword to fall on here, he would apparently prefer to stack his subordinates on it like a shish kebab before taking accountability for anything himself
It also doesn't help that Kotick's walkback of the original response effectively threw Townsend under the bus for a letter that the Wall Street Journal now reports was drafted by Kotick himself.
To the extent that Kotick believes there's a sword to fall on here, he would apparently prefer to stack his subordinates on it like a shish kebab before taking accountability for anything himself.
Then there was the news that Activision Blizzard refused multiple requests from Blizzard co-leads Jen Oneal and Mike Ybarra to make their compensation packages equal, a staggering display of malice, greed, and incompetence for a company not just in the middle of a sexual harassment and workplace culture scandal, but one facing multiple active lawsuits from government agencies for paying women less than men for the same job.
Even in the midst of all this, Kotick apparently hasn't learned a thing. Because if he had learned anything, he would have understood that the company cannot make a credible claim to fixing its problems so long as he remains in charge.
QUOTE | "We are listening and taking action. Our ambition is to make Activision Blizzard the most welcoming and inclusive workplace in our industry - with a strict zero-tolerance policy for harassment and discrimination of any kind." - Activision Blizzard's Twitter account on Tuesday morning makes it absolutely clear the company will not tolerate harassment.
QUOTE | "Mr. Kotick quickly apologized 16 years ago for the obviously hyperbolic and inappropriate voice mail, and he deeply regrets the exaggeration and tone in his voice mail to this day." - An Activision Blizzard spokesperson addresses Kotick threatening to have his assistant killed in a voicemail to her because it will tolerate harassment that a) occurred in the past, b) was hyperbolic, or c) was inappropriate. Oh, it will also tolerate harassment if the person regrets the actions that got them in trouble. So yeah, zero tolerance for harassment unless it's one of those super-rare edge cases that covers, uh... everything.
The best/worst part of the above quote is that it effectively admits the incident happened just as the Wall Street Journal reported, yet when Activision Blizzard employees pointed out the obvious contradiction with the zero tolerance policy in an all-hands meeting on Wednesday, they were told Kotick was allowed to stay because there was insufficient evidence of the voicemail death threat.
I don't know about you, but if I threaten to have someone killed at my job, I'm no longer going to have that job. But as far as we know, Kotick was never even disciplined for this. Even with some of the other horror stories in the Wall Street Journal report, the company mentioned that employees found to have acted inappropriately were at least disciplined or made to receive counseling.
No such comment was made about Kotick, because he is apparently considered above having to face the consequences for his actions.
So long as Activision Blizzard and its board of directors are willing to look the other way here, there's no reason for anybody inside or outside the company to trust its leadership to live up to their obligations to their employees, whether they be legal or ethical.
The rest of the week in review
QUOTE | "If you really are willing to just do whatever doesn't upset your players, can you ever speak to your player base with conviction? Can you ever stand up for yourself? Because these are things that can really happen. You can really get into a situation where you've made a decision and you might be in a position where one of your developers is going to sort of get thrown under a bus. Are you going to stand up for them?" - Xbox Studios director of live operations Crystin Cox stresses the need for developers to figure out where their own ethical boundaries are before starting to think about how to monetize their games.
QUOTE | "My hope (and I think I have to present it that way as of now) is as an industry we'd work on legal emulation that allowed modern hardware to run any (within reason) older executable allowing someone to play any game." - Xbox head Phil Spencer calls for the industry to embrace emulation so that people can actually enjoy the games it makes and explore the medium's history in the same way virtually every other popular art form allows.
QUOTE | "What I'd say today on NFT, all up, is I think there's a lot of speculation and experimentation that's happening, and that some of the creative that I see today feels more exploitive than about entertainment" - Spencer weighs in on the blockchain gaming fad.
QUOTE | "COVID-19's largest impact on video games so far is on new software releases. What we saw last year was strict stay-at-home orders but also a range of new software releases coming from key and major franchises. This year, consumers have become more accustomed to stay-at-home orders but we've also seen a lack of new releases in the market due to COVID-19. We've seen a number of major titles being pushed out of 2021 into late 2021 or into 2022 and beyond." - Global Sales Data senior games analyst Aidan Sakiris dives deep into how the pandemic has impacted the way people make and buy games.
QUOTE | "Microsoft viewed itself as, 'Well, if anybody's going to put a personal computer in the living room, it's going to be us.'" - Microsoft's first chief Xbox officer Robbie Bach talks about the company's jump into console gaming in our 20th anniversary retrospective feature on the original Xbox.
QUOTE | "Oh no, it appears that my name is inappropriate content." - WB Games Montreal's Osama Dorias points out a problem with Forza Horizon 5's word filter that Microsoft said it is working to fix.
QUOTE | "Looking back on it, it seems there's a huge value in the IP and we can say we regret that this happened, but the company was in a totally different place back then. So it's not that easy to say it was a bad decision. I think it was the right decision for that time." - One More Level VP and game director Radosław Ratusznik on giving up the IP to the studio's Ghostrunner in the game's original publishing deal, even though it meant the studio wasn't involved in discussions to sell the IP to 505 Games.
STAT | 50/50 - The breakdown of Xbox Series S and Xbox Series X sales worldwide, according to Ampere analysts.
QUOTE | "We don't have any magic bullets in navigating the supply chain." - Nvidia CEO Jensen Huang warns investors that global supply chain issues will continue to impact hardware makers into next year. Toshiba expects it to last until at least September 2022, while Intel is preparing for issues until 2023.