Tag Archives: Activision Blizzard

Activision Blizzard Pays SEC $35 Million To Settle Probe

Gaming,

CNBC reported that video game developer Activision Blizzard agreed to pay a $35 million settlement over charges it failed to maintain “adequate” controls for collecting and assessing reports of workplace misconduct and that it violated federal whistleblower protection rules, the Securities and Exchange Commission said Friday.

The SEC claimed workplace misconduct complaints were neither collected nor analyzed as expected by public disclosure regulations, CNBC reported. “Moreover, taking action to impede former employees from communicating directly with the Commission staff about a possible security law violation is not only bad corporate governance, it is illegal,” SEC director Jason Burt said.

The settlement is not an admission of wrongdoing but concludes a probe that focused on Activision Blizzard’s standards from 2018 to 2021.

The SEC included the following paragraph in its press release:

“The SEC’s order finds that Activision Blizzard failed to implement necessary controls to collect and review employee complaints about workplace misconduct, which left it without the means to determine whether larger issues existed that needed to be disclosed to investors,” said Jason Burt, Director of the SEC’s Denver Regional Office. “Moreover, taking action to impede former employees from communicating directly with the Commission staff about a possible securities law violation is not only bad corporate governance, it is illegal.”

The Wall Street Journal reported that female employees at Activision complained for years about alleged sexual assaults and mistreatment. The SEC’s probe examined what Activision’s management knew about the alleged incidents and how it addressed them internally, the Journal reported.

Activision’s system wasn’t designed to collect and analyze complaints about workplace misconduct across its separate business units, the SEC said in a settlement order. As a result, Activision’s management and directors often didn’t have information about employee complaints or incidents involving harassment, the SEC order said.

According to the Wall Street Journal, the settlement also said that Activision’s separation agreements with employees from 2016 to 2021 included an improper clause requiring ex-workers to tell the company if agencies such as the SEC contacted them about reports of misconduct. The SEC said that requirement violated the SEC’s whistleblower-protection rules, which seek to ensure that company insiders aren’t prevented from informing regulators about wrongdoing.

It is interesting to note that The Wall Street Journal reported that the $35 million fine is a significant penalty for an enforcement case focused on a company’s disclosure procedures. The SEC under Chair Gary Gentler and Enforcement Director Gurbir S. Grewal has ratcheted up penalties, saying fines need to be higher to effectively deter wrongdoing.

My hope is that the SEC’s order will result in Activision Blizzard to actually listening to employees who have been harassed or abused in the workplace and enact a significant penalty upon the person(s) who engaged in harassment or abuse. If not, I suppose the SEC can take additional action on the company.

FTC Sues To Block Microsoft’s Acquisition of Activision

Microsoft, , ,

The Federal Trade Commission on Thursday sued to block Microsoft’s $69 billion acquisition of the video game publisher Activision Blizzard, charging that the massive deal would allow the Washington tech giant to suppress its competitors in gaming, The Washington Post reported.

According to The Washington Post, the lawsuit represents the FTC’s most significant effort to rein in consolidation in the tech industry since prominent tech critic Lina Khan (D) became the commission’s chair and was expected to usher in an era of antitrust enforcement characterized by a willingness to bring cases in court rather than pursue settlements with companies.

The FTC lawsuit against Microsoft could foil the company’s ambitions to become a heavier hitter in gaming frontiers. Activision is the owner of popular titles such as Candy Crush and Call of Duty, and its acquisition could bolster Microsoft in its competition with Japanese console makers Nintendo and Sony.

The Washington Post also reported that the commission voted Thursday on a party-line vote to issue the lawsuit in administrative court, with the three Democrats in favor of the complaint and one Republican against it.

The Federal Trade Commission (FTC) posted the following:

The Federal Trade Commission is seeking to block technology giant Microsoft Corp. from acquiring leading video game developer Activision Blizzard, Inc. and its blockbuster gaming franchises such as Call of Duty, alleging that the $69 billion deal, Microsoft’s largest ever and the largest ever in the gaming industry, would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.

In a complaint issue today, the FTC pointed to Microsoft’s record of acquiring and using valuable gaming content to suppress competition from rival consoles, including its acquisition of ZeniMax, parent company of Bethesda Softworks (a well-known game developer). Microsoft decided to make several of Bethesda’s titles, including Starfield and Redial Microsoft exclusives despite assurances that it had given to European antitrust authorities that it had no incentive to withhold games from rival consoles…

…Activision is one of only a very small number of top video game developers in the world that create and publish high-quality video games for multiple devices, including video game consoles, PCs, and mobile devices. It produces some the most iconic and popular video game titles, including Call of Duty, World of Warcraft, Diablo, and Overwatch, and has millions of monthly active users around the word, according to the FTC’s complaint. Activision currently has a strategy of offering its games on many devices regardless of producer.

The Wall Street Journal reported that Sony has been the loudest critic of the planned Activision deal, arguing that it could hurt competition if Microsoft restricts access to Activision games, especially Call of Duty, due to the franchise’s exceptional popularity.

According to The Wall Street Journal, Microsoft has said it doesn’t plan to deny Sony and others access to Activision games and that its deal for the company wouldn’t hurt competition. The company has publicly pledged to give Sony and Nintendo access to new Call of Duty games on their consoles for the next 10 years. Though Microsoft doesn’t disclose Xbox sales, it has said it would still be the third-largest video game console maker after Sony and Nintendo after merging with Activision.

What does this mean for gamers? It seems to me that the FTC’s decision to sue Microsoft over the Activision Blizzard acquisition means there could be a lengthy court battle. There is no way to know how a court will decide this case. Based on what I’ve seen on social media, there are a lot of gamers who hoped the acquisition would happen. The FTC’s decision to sue is disappointing.

Activision Blizzard Require A Phone Number For Its Newest Games

Gaming, ,

Fortune reported that Activision Blizzard is removing an anti-cheat precaution from its newest games after players complained it discriminated against poor people.

According to Fortune, just over a week before the launch of Overwatch 2, Activision’s newest shooter, the developer announced that players would need to have a valid phone number to play the game. The system, called SMS Protect, would help the developer keep cheaters and abusive players out of the game. Banned players would be forced to get a new phone number if they wanted to play the game again.

Yet, players found that SMS Protect also excluded anyone on a prepaid phone plan, effectively locking them out of the game. Players with too little income to afford a phone service contract, or who just preferred using prepaid phones, complained that the developer was barring them from enjoying the game.

On Thursday, Blizzard posted “Overwatch 2 Launch Status Update” in its Overwatch Forums. From the post:

SMS Protect

We designed Overwatch 2 be a live service, which enables us to be responsive to a variety of player feedback. We have made the decision to remove phone number requirements for a majority of existing Overwatch players. Any Overwatch player with a connected battle.net account, which includes all players who have played since June 9, 2021, will not have to a provide phone number to play. We are working to make this change and expect it to go live Friday October 7. We will update players once it is in effect.

We remain committed to combating disruptive behavior in Overwatch 2 – accounts that were not connected to battle.net as well as new accounts will still have to meet SMS requirements, which helps to ensure we’re protecting our community against cheating. If a player is caught engaging in disruptive behavior, their account may be banned whether they have a new account or not…

Engadget reported that Call of Duty: Modern Warfare II, which arrives on October 28, will require players to connect a phone number to their battle.net account to play the game. “Call of Duty: Modern Warfare II, newly created Overwatch 2 accounts, and newly created Call of Duty Modern Warfare accounts require a phone number,” says a recently updated support page spotted by PC Gamer.

According to Engadget, the requirement comes following a week of controversy around SMS Protect, the phone-linking system in use by Overwatch 2 and soon Modern Warfare II. Where the studio previously said all players would need to link a phone number to their battle.net account, now that requisite only falls on new Overwatch players. At the moment, it’s unclear if all Warzone 2.0 players will need a mobile phone number to play that game once it arrives on November 16th.

Personally, I understand why Activision Blizzard wants to make an effort to remove players who are cheating, or who are mean to other players, from their games. Failing to remove those players could prevent honest players from returning to the game.

However, I don’t think the solution is to force players to give Activision Blizzard their phone number before they can start playing the newest games. That requirement feels invasive, and could make some players decide to avoid playing the video games that require SMS Protect. It also appears that SMS Protect will exclude players who have pre-paid phone plans, even if those players have never been a problem in other Activision Blizzard games.

CMA Investigates Microsoft Acquisition of Activision Blizzard

Microsoft,

The UK’s Competition and Markets Authority (CMA) announced that it is investigating the anticipated acquisition by Microsoft Corporation of Activision Blizzard, Inc. The CMA stated that July 6, 2022 is the launch of the merger inquiry, and it gave notice to the parties. From the CMA:

“6 July 2022: The Competition and Markets Authority (CMA) is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act of 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”

CNBC reported that the U.K’s Competition and Market Authority said its investigation would consider whether the deal may harm competition – “for example, through higher prices, lower quality, or reduced choice.” According to CNBC, the CMA set a September 1 deadline for its initial decision.

CNBC also reported that Lisa Tanzi, Microsoft’s corporate vice president and general counsel, said regulatory scrutiny of the deal was to be expected, adding the company would “fully cooperate” with the CMA.

If approved, CNBC reported, the acquisition would have huge implications for the $190 billion video game industry, handing control of incredibly lucrative franchises including Call of Duty, Candy Crush and Warcraft to one of the world’s biggest tech companies.

TechCrunch reported that the United States Federal Trade Commission (FTC) is also currently investigating the Microsoft – Activision Blizzard deal. According to TechCrunch, the FTC regulators have been known “to scupper, or add provisions, to deals, as well as nod them through.”

All of this comes as Activision Blizzard faces what seems to be an ongoing series of controversies. The company was the subject of a two-year investigation by the California Department of Fair Employment and Housing, which it described as having a “‘frat boy’ workplace culture” and a “breeding ground for harassment and discrimination against women.”

TechCrunch pointed out that CEO Bobby Kotick reportedly knew about, yet failed to act, over sexual misconduct and rape allegations.

In short, Activision Blizzard is currently, and has been, a mess. While it is important to keep in mind that there are some wonderful, creative, people who work for that company, it is the inaction of the CEO and the Board that is allowing the controversy to continue. I honestly hope that the regulators allow the Microsoft – Activision Blizzard merger – if for no other reason than to give the employees a better work environment.

Diablo Immortal’s China Release Has Been Delayed

Gaming, ,

Diablo Immortal is the newest game in Activision Blizzard’s Diablo franchise. It was officially released on June 2 for not only mobile devices but also PCs. CNBC reported that shares of the game fell nearly 7% in Hong Kong on Monday after it announced plans to delay the release of Diablo Immortal in China. According to CNBC, the game did not announce a new launch date.

NetEase and Activision Blizzard worked together on Diablo Immortal. The game was set to release in China on June 23, but that has been delayed. The reason for the delay requires some explanation.

Financial Times reported that shares in NetEase dropped on Monday morning after the Chinese company fell foul of China’s censors over a social media post that was suspected of alluding to Winnie the Pooh, a popular way to derisively refer to President Xi Jinping.

According to The Financial Times, the delay came as a screenshot circulated online of a post published by the game’s official account on Weibo, the popular Chinese microblogging site, dated May 22, that read: “Why hasn’t the bear stepped down.”

The remark was interpreted as a reference to China’s President Xi Jinping, who is often illustrated as Disney’s Winnie the Pooh. The cartoon bear has been blacklisted by censors in China for years.

This isn’t the first time that China has cracked down on gaming. In August of 2021, South China Morning Post reported that gamers in China who are under the age of 18 would have their playing time limited to one hour on regular days and two hours on public holidays. That same month, the BBC reported that Tencent announced it was rolling out facial recognition to stop children from playing video games between 10pm and 8am.

Kotaku reported that the postponement of Diablo Immortal in China comes three days before the game’s intended Chinese release and just a few days after the game’s official Weibo account was suspended from being allowed to post.

According to Kotaku, a contact translated what was written on Weibo as “What do you think about the bear?”, but says it was written to be idiomatic. Kotaku notes that either way, if real, it seems an extraordinary thing to have posted on an official account in China.

Kotaku also pointed out that there is a press release that was posted on Blizzard’s Chinese website, stating that the reason for this very last-minute delay is a need to make “a number of optimization adjustments to the game”. (Kotaku appears to have translated this via Google.) The press release also said that the adjustments included improving model rendering, support for a wider range of devices, and “network and performance optimizations”.

Microsoft Agrees to Respect Activision Blizzard Unionization

Microsoft,

Microsoft said Monday it would respect the rights of Activision Blizzard workers to join a union, and would enter into a so-called labor neutrality agreement with major media union Communications Workers of America, which has been helping video game workers organize, The Washington Post reported.

According to The Washington Post, if Microsoft’s acquisition of Activision Blizzard is approved, the new labor agreement will take effect for the video game giant 60 days after the deal is finalized.

The Wall Street Journal reported that earlier this month, Microsoft unveiled a set of principles aimed at demonstrating its willingness to work with unions. The company said it wouldn’t discourage employees from using their legal right to form and join unions and wouldn’t try to complicate the process of unionization for its employees.

According to The Wall Street Journal, the principles marked Microsoft’s latest attempt to carve out a position distinct from other technology companies on a sensitive subject in the industry. U.S. tech companies have long avoided unions, and some have tried to discourage employees from joining them. Microsoft reported a global workforce of more than 180,000 last year. None are currently unionized in the U.S.

The New York Times reported: A group of nearly 30 employees at one of Activision’s studios voted to unionize through an N.L.R.B. election in May despite Activision’s opposition to holding the election. But completing such a process can be time consuming, with unions and employers sometimes spending months or even years litigating the results.

According to The New York Times, through the agreement, workers will have access to an expedited process for unionizing, overseen by a neutral third party, in which they will indicate their support for a union either by signing cards or confidentially through an electronic platform.

Chris Shelton, the president of the Communications Workers unions, said in an interview, “This process does give us and Microsoft a way to do this quote unquote election without spending the time, the effort and the controversy that goes along with an N.L.R.B. election.”

Personally, I’m happy to see that Microsoft is willing to work with unions. That’s a huge change from Activision Blizzard King, where the high-ups have been fighting against unionization. The Wisconsin workers in Raven Software were able to unionize – but not before Activision engaged in union-busting attempts. Raven contractors worked on franchises like Activision’s Call of Duty games.

It would be wonderful if the Activision Blizzard King workers, who have been struggling to get the company to accept their unionization efforts, can easily join a union after the Microsoft acquisition. If so, this would set a huge precedent for workers at other gaming companies.

Activision Blizzard Employees Walk Out Over Lifting Of Vaccine Mandate

Gaming

We are, once again, at the point where some companies start pushing for people who were working from home to go back to the office. In some cases, companies will require workers to be vaccinated before coming into the workplace. Unfortunately, Activision Blizzard, a company that has several lawsuits issued against it, decided now is the time to drop their coronavirus vaccine mandate. Some employees are strongly against that decision.

Kotaku posted the full letter from Activision Blizzard Chief Administrative Officer Brian Bulatao to workers. The key paragraph is:

Everyone, As conditions improve and we prepare to welcome more of you back to our offices, I’d like to share an update regarding our vaccine policy. Effective immediately, we are lifting our vaccine mandate for all U.S. employees. This means that employees no longer need to be fully vaccinated against COVID-19 in order to return to the office…

The Washington Post reported that in response to the company’s decision to drop their coronavirus vaccine mandate workers staged a virtual walkout in protest. This is Activision Blizzard’s fourth walkout since July of 2021.

According to The Washington Post, ahead of Monday’s walkout, the ABK Workers Alliance – which organized the company’s previous walkouts – posted a statement to Twitter calling for the company to “make working from home an equal and equitable option for all employees” and to reinstate the vaccine mandate at Activision Blizzard-owned studios that have not already done so.

The @ABetterABK Twitter account posted a short thread about the walkout: “Due to new RTO policy around no longer mandating vaccination requirements in regards to the ongoing pandemic, a group of ABK employees will be conducting a walkout on Monday April 4 at 10am PDT. We have 3 demands:”

Their demands were: An immediate reversal to lifting the vaccine requirement. Remote work should be offered as a permanent solution. The decision to work remote or in office should be made by each individual employee.

TechCrunch reported: Employees voiced concern about the plan, which would make returning to work especially unsafe for immunocompromised staff. Blizzard has almost 10,000 employees, though they are spread across a variety of global offices. But eliminating vaccine mandates and other tactics to reduce the spread of COVID-19 struck some workers as short sighted and brazen.

According to TechCrunch, Brian Bulatao walked back his message soon after the announcement of a walkout. He declared that individual studios could choose whether or not to enforce a vaccine mandate, but members of ABK Workers Alliance felt this response was unsatisfactory.