By Karina Masolova
Activision Blizzard made its latest move in a series set to position the company as a multi-platform entertainment franchise power. The video game development company launched its own TV and movie studio, Activision Blizzard Studios. It joins companies like Mattel and Hasbro, whose in-house studios are set grow their overall business. On the other side of the equation, companies like Disney and MGA are building up their digital/interactive arms.
The growing trend to develop non-entertainment/character properties into full-blown, multi-platform franchises has marked effects on the licensing as these brands gain more staying power and influence. Of the upcoming movies with licensing potential slated for release through 2020, toys and video games/apps made up 7% and 6% of all sources, respectfully, and their share is expected to grow.
Activision Blizzard Studios will be co-headed by former Disney executive Nick van Dyk. Dyk confirmed that Activision will still work with established studios, noting that “we’re not in the film and television business, we’re in the franchise, intellectual property business,” at an Investor Day conference. To this effect, Activision is aggressively ramping up its licensing efforts; at this year’s Licensing Expo and Brand Licensing Europe the company showed off key brands Skylanders, Call of Duty, the new video game Destiny and Guitar Hero.
First up from the new division is the animated TV series “Skylanders Academy,” based on the video game franchise. Skylanders, which launched in 2011, is firmly situated in our upcoming list of $100 million entertainment/character properties for 2014 thanks to its prolific presence in interactive toys. Activision recently expanded the franchise with a mobile game app from Vicarious Visions. Based in the iOS ecosystem, the game allows players to switch between devices of their choice, including Apple TV, and comes with the brand’s digital-connected toys. Juniper Research forecasts that smart toy sales will reach $2.8 billion in revenues this year, driven by the popularity of the console-connected toys-to-life segment dominated by Skylanders, Amiibo (Nintendo) and LEGO.
Also amongst the first brands set to be exploited by Activision is the video game series Call of Duty. The latest installment, “Call of Duty: Black Ops III” rang up $550 million in sales worldwide in its first three days—demonstrating the kind of franchise firepower the company is counting on to propel its new content studio. Activision called the “Black Ops III” launch the biggest entertainment debut of the year, comparing its retail sales to Jurassic World‘s global first-weekend record box-office revenue of $524 million.
And it’s not just TV and film—the PC and console game maker is also moving into the mobile market with its acquisition of King Digital Entertainment, the makers of mobile game app Candy Crush. Amidst expectations of falling revenue, King sold out to the tune of $5.9 billion, making it the largest such acquisition ever. The move is expected to serve as an entry point for Activision into game apps by maintaining the power of Candy Crush as well as developing new properties.