Activision Blizzard announced their 4th quarter and fiscal year 2018 financial results today while also noting they were taking steps to reach their full potential across their various brands and franchises. This meant leadership reorganization as well as aligning their headcount where it is most needed. In simpler terms, this translates into letting go approximately 8% of the workforce (mentioned during their earnings call).
With regards to Blizzard Entertainment, most of the layoffs were in non-gaming development such as administrative, community management, publishing, and e-sports. Many were considered ancillary positions that supported departments/divisions (good example were the community teams that helped to support and promote Hearthstone when it was first announced, and continued to perform that function until today when a lot of that team were laid off). Others were much smaller/specialized like the individual who was responsible for designing a lot of the plushy collectibles (and other merchandise) that are sold on Blizzard Gear Shop.
To put it simply, a lot of good people in non-game development positions lost their jobs today. I know the exercise here; there’s often times a lot more (higher in the chain who get paid much more) who should’ve gotten the axe instead. The only place (as far as non-game development goes) where I agree that cuts really needed to be made was anything to do with e-sports because as I’ve mentioned before, force promoting it the way companies like Blizzard have been doing, is not going to make it any more mainstream; it has to be able to take hold more organically. And since designer + development positions are prioritized for the time being, that also meant a reprieve for some of those folks (some who also should’ve been shown the door a long time ago) at Blizzard.
The picture is slowly filling in as to why Mike Morhaime may have departed when he did since I cannot see him agreeing to paring the workforce down in this manner (more so when considering how often they would spend time/resources on design iteration and outright cancelling projects). This was obviously becoming a challenge to balance as more corporations are falling for the “do more with less” mantra (which would be ok if it weren’t only the top few in the organization making off like bandits). Plus there was this years long failure to take advantage of mobile (Blizzard is only starting now with the much maligned Diablo: Immortal).
For players who believe this will mean better communication with the designers/developers, think again. Regardless of what has been several months of bad news, Blizzard still has a sizable captive community that doesn’t pay much attention to this stuff (it’s why despite my own issues with Blizzard’s direction in recent years, I still remain a long term shareholder in the holding company). For the rest looking to effectuate actual change, the only way to make a dent in this area is to speak with the wallet (and for many, that is easier said than done).
UPDATE: Also noted in the earnings call (for the Blizzard Entertainment portion) was that there were “no frontline releases planned for fiscal year 2019” which accounts for part of the downwards guidance for their 2019 earnings estimates. Thus no World of Warcraft or Hearthstone expansion and no Diablo “4” (which as noted in my other posting, isn’t surprising since it looks like it’s at least an year off of its prior target dates/milestones). Diablo: Immortal (mobile) is slated for a potential release at the end of 2019 but its business model hasn’t yet been decided on (plus they may as well bake a potential slip into 2020 launch into the already forward looking bad news).
