The situation started last week when pro player Chung “Blitzchung” Ng Wai spoke in support of Hong Kong citizens currently embroiled in months-long protest with the government. During a livestream of the Hearthstone Asia-Pacific Grandmasters, Blitzchung called for a liberated Hong Kong and a “revolution of our age.” As a result, he was initially banned from competitive play for 12 months and had his prize money revoked. The decision sparked immediate outcry against Blizzard, including demonstrations from workers on Blizzard’s campus in Irvine, California. Blitzchung’s suspension has since been reduced to six months and his prize money returned.
Later that week, American University’s three-player Hearthstonedemonstrated in their own way, by holding up a sign that said “FREE HONG KONG, BOYCOTT BLIZZ” during a match. When a punishment from Blizzard to similar to Blitzchung’s was not forthcoming, the team voluntarily dropped out of future tournaments. Now, they’ve been officially banned for half a year.
“Every Voice Matters at Blizzard and we strongly encourage everyone in our community to share their viewpoints in the many places available to express themselves. However, the official broadcast needs to be about the game and competition, and to be a place where all are welcome.”
The email goes on to state that Chambers violated a rule regarding sportsmanship and that he is banned from competition for six months from the incident.
“Happy to announce the AU Hearthstone team received a six month ban from competition,” Chambers tweeted. “While delayed I appreciate all players being treated equally and no one being above the rules.”
In the time since Blitzchung’s ban, pressure has mounted against Blizzard from fans disappointed with a slow response to the incident. Eventually, Blizzard president J. Allen Brack released a statement insisting that the content of Blitzchung’s message played no factor in disciplinary decisions, and that it was a result of breaking a general rule that states the company can punish players for “engaging in any act that, in Blizzard’s sole discretion, brings you into public disrepute, offends a portion or group of the public, or otherwise damages Blizzard image.”
A story published by the Washington PostTuesday night revealed that game publisher Activision Blizzard has been offering third-party fertility and pregnancy tracking services to its employees—and then receiving their anonymized data back in return.
Ovia Health offers a suite of wellness apps for family planning, allowing users to input their personal information to keep track of their efforts to conceive and maintain a healthy pregnancy, and for documenting a child’s health once they’re born. According to The Post, Ovia also provides employers who pay for it access to anonymized, aggregate data that tells them much of what their employees put into their Ovia apps, “from their trying-to-conceive months to early motherhood.”
The company claims it complies with privacy laws, and Activision Blizzard also reportedly places strict controls on who can view the data. The story quotes Milt Ezzard, Activision Blizzard’s vice president of global benefits, as saying that Ovia was instrumental in shifting employee sentiment towards apps that ask for personal information.
“Each time we introduced something, there was a bit of an outcry: ‘You’re prying into our lives,’” Ezzard told The Post, later noting that employees’ attitudes have improved since Ovia was first offered in 2014. “Eventually people understood it’s all voluntary, there’s no gun to your head, and we’re going to reward you if you choose to do it.” The company reportedly offers employees a $1 gift card for each day the app is used, but didn’t otherwise disclose how the anonymized data is used.
Despite its assurances of privacy, there is concern that data could still be attributed to individual employees in instances like this from clues derived from real-life interactions, and privacy experts caution that the data harvested from wellness apps could lead to insurance companies using that data to deny coverage or increase premiums.
In an email to Kotaku, an Ovia spokesperson said that employers never see the “personal, intimate information” users enter into the app. Instead, it said, employers see “percentage-based,” “aggregate, de-identified data to ensure that Ovia is helping women have healthier outcomes — i.e. are outcomes improving? Are employees using the benefit?”
Kotaku reached out to Activision Blizzard for comment and will update this story should it respond. For more, read the full story over at the Washington Post.
Yesterday, at the exact moment Activision Blizzard chief executive officer Bobby Kotick hopped on a quarterly earnings call to inform shareholders that his company had just gone through a “record year,” employees across the publisher of Call of Duty, World of Warcraft and more were being brought into conference rooms and informed that they were losing their jobs.
“It’s a bloodbath here,” one Blizzard employee told me last night. “A lot more cuts than we were expecting.”
As Kotick and other executives were telling investors that the next Call of Duty was shaping up to be the best one yet, employees across Activision Blizzard’s various divisions nervously sat at their desks, waiting to see who would be next to get the severance envelope. In Blizzard’s publishing department, management had booked a series of meetings from 1pm to 3pm Pacific. On the calendar, they were all blank. Everyone knew what that meant.
“The look on people’s faces as they’re pulling in through the [campus] gates is just awful,” said another Blizzard employee. “This is the fucking worst.”
Later on the call, Kotick delivered the grim news: Activision Blizzard, which employed around 9,600 employees last year, would reduce its workforce by 8%. That equated to around 800 people. Some were junior employees, having started at the company just recently; others had been with Activision Blizzard for 15 years or longer. Some were informed yesterday; others, particularly in Europe and other non-U.S. divisions, didn’t find out their fates until this morning.
It was carnage. People were laid off at Activision’s main office in Santa Monica, California, where an entire team of Destiny publishing staff had been coming to work with nothing to do. (Some of them were laid off; some were moved to Call of Duty or other teams. Some in other departments were also laid off.) People lost their jobs at King, the developer of Candy Crush, and at Activision’s various development studios including Vicarious Visions (Albany, NY) and High Moon Studios (San Diego, CA), both of which had handled support on Destiny 2. Activision Blizzard staff in Europe, Latin America, and other regions across the world also lost their jobs. Some who were laid off wrote messages on social media to say goodbye, while developers all across the video game industry tried to help by posting job listings on Twitter and Facebook. Although the bulk of laid-off employees were support staff, some were in departments like art and design as well.
Over the past week I’ve talked to around 20 people who were laid off or close to those being laid off, as well as others with knowledge as to what’s happening at Activision Blizzard. If there’s a consensus, it’s rage. Rage at Kotick’s comments, at the way Activision executives seemingly view their employees as numbers on a spreadsheet, at the callousness in which this layoff was handled. There’s rage at who was chosen to be laid off—two people told me that it felt like a random, haphazard practice—and rage that some important employees were let go. Some who had been laid off told me they had felt safe, expecting their studios or departments to not be affected. Even those who felt layoffs were necessary or justifiable said they were shocked by the scale, scope, and coldness from executives.
At Blizzard, for example, rumors of big layoffs had been circulating as early as November. Back then, as I began to learn about the sweeping changes that had come to the legendary game studio in 2018, I heard from a former high-level employee that layoffs were coming in February. I heard the same from a source plugged into the investor community. Another Blizzard employee told me today that the layoffs had been an “open secret” for months.
Blizzard, founded in 1991, has developed critically and commercially successful games from Warcraft and StarCraft to Diablo and Overwatch. It has kept its game quality high even after Activision merged with the studio in 2008. It just hasn’t produced many new games of late, increasing tensions with management in Santa Monica. Since the beginning of 2018, as Kotaku has reported previously, the mandate at Blizzard had been to cut costs and produce more games.
To those who worked outside of Blizzard’s development teams, in departments like publishing, esports, QA, and IT, it felt last year like the axe was about to fall. After all, if Blizzard was looking to develop more games without spending more money, they’d need to lose headcount in non-game-development departments. But management said nothing. With no union or other method for collectively communicating with executives, employees were left with nothing but whispers. As November turned into December and the new year came, all they could do was wait.
Last week, as rumors began heating up and culminated in a Bloomberg story on Friday night reporting that hundreds of layoffs were coming, one Blizzard employee reached out to me to ask if I knew whether or not they’d get severance. The person said they weren’t expecting to be affected, but wanted to know if I’d heard anything about how impacted employees would be treated. Just in case. On Tuesday night, I found out they’d been laid off. (Full-time employees who were laid off across Activision Blizzard did get severance, although contractors did not.)
I heard other stories, too. Some people supposedly learned their fate early, signing non-disclosure agreements last week in exchange for severance packages. Others took buyouts thanks to the Career Crossroads program that allowed QA, customer service, and IT employees to voluntarily leave, as we reported in December. Some were given hints from their managers—warnings to polish their résumés before Tuesday. One Blizzard employee told me they’d see the job networking website Linkedin open on computer screens as they walked around the office over the past week.
Some outside of Blizzard, at Activision’s various development studios, thought they were safe but on Tuesday and Wednesday reached out to let me know that they or their colleagues had been unexpectedly laid off.
Last night, the picture at Blizzard became clearer. Support teams had been gutted. The layoffs were largest in non-development departments like IT and QA, according to those who were there. The esports department was hit hard, as many within Blizzard had expected—after all, it had been led by Amy Morhaime, wife of Mike, the long-time Blizzard CEO who left the company last fall. She departed around the same time. The two Morhaimes were seen as big advocates for esports within Blizzard, even when it wasn’t quite as lucrative as Activision’s executives might have hoped, and with them gone, the department was in danger.
Blizzard’s publishing department, which is comprised of PR, marketing, community, and other game support divisions, was also hit hard. Around late 2015 or early 2016, Blizzard had split North American and global publishing into two departments, according to long-time employees. It was seen as a bad move by those who worked there, one that caused resentment, redundancy, and unnecessary bureaucracy. As part of this week’s layoffs, Blizzard reconsolidated those divisions, laying off dozens in the process. Executives like chief operating officer Armin Zerza and marketing boss Todd Harvey, both of whom are heavily connected to Activision, are running the show.
So what does this all mean for the future of Blizzard? Since the beginning of 2018, Activision has been exerting more influence on Blizzard, pushing the company to release more games and find more ways to make money. General consensus, even among rank-and-file employees, is that Blizzard’s lack of new game output over the past few years hasn’t been healthy or sustainable. But Activision’s influence has raised questions among Blizzard staff about whether the studio can retain its culture. Said one former Blizzard employee to me last December: “There’s a real struggle now between developers and the business people… Strategic decisions are being driven by the finance group.”
For decades, Activision’s philosophy has revolved around annualized releases, most notably with the gargantuan Call of Duty series, which hasn’t skipped a year since 2004. That sort of schedule is diametrically opposed to Blizzard’s “release it when it’s ready” philosophy, which has led to massively successful games like Overwatch and Hearthstone but has also led to periods like the present, in which Blizzard has gone three years without releasing a major game. The tension between annualized releases and “games as a service” that don’t have to have new, boxed releases and sequels is one of the main reasons that the Activision and Bungie relationship never worked out. Last month, the two companies split, with Bungie buying the full rights to sell and publish Destiny on its own.
This year will likely be a slow one for Blizzard, as the company implements its new strategy across franchises like Diablo, Warcraft, and Overwatch (all of which have new games in development, many for smartphones). Then, we’ll likely see more new Blizzard games come out more regularly than ever before. And we’ll have to wait and see if they live up to the quality bar Blizzard has set for itself over the past three decades.
At the Yard House restaurant in the Irvine Spectrum mall in California last night, a group of current and now-former Blizzard employees met up to drink and commiserate. The mood was somber, according to one person who was there. There was plenty of sadness and blame to go around. There was anxiety expressed by those who now need to hunt for new jobs, and those who might be forced to uproot their families for new cities or countries. And among those who remain at the company, there’s survivor’s guilt. The fallout of this layoff will linger for a long time. “Work again tomorrow,” said one Blizzard employee who remains at the company. “I have a feeling no one will be doing much work the rest of the week.”
Publisher Activision Blizzard has begun its long-rumored layoff process, informing employees this afternoon that it will be cutting staff. On an earnings call this afternoon, the company said that it would be eliminating 8% of its staff. In 2018, Activision Blizzard had roughly 9,600 employees, which would mean nearly 800 people are now out of work.
This afternoon, the mega-publisher began notifying those who are being laid off across its various organizations, which include Activision, Blizzard, and King.
On the earnings call, Activision Blizzard CEO Bobby Kotick told investors that the company had “once again achieved record results in 2018″ but that the company would be consolidating and restructuring because of missed expectations for 2018 and lowered expectations for 2019. The company said it would be cutting mainly non-game-development departments and bolstering its development staff for franchises like Call of Duty and Diablo.
Development sources from across the industry told Kotaku this afternoon that the layoffs have affected Activision publishing, Blizzard, King, and some of Activision’s studios, including High Moon.
At Blizzard, the layoffs appear to only have affected non-game-development departments, such as publishing and esports, both of which were expected to be hit hard.
“Over the last few years, many of our non-development teams expanded to support various needs,” Blizzard president J. Allen Brack said in a note to staff around 1pm PT that was obtained by Kotaku. “Currently staffing levels on some teams are out of proportion with our current release slate. This means we need to scale down some areas of our organization. I’m sorry to share that we will be parting ways with some of our colleagues in the U.S. today. In our regional offices, we anticipate similar evaluations, subject to local requirements.”
The letter also promised “a comprehensive severance package,” continued health benefits, career coaching, and job placement assistance as well as profit-sharing bonuses for the previous year to those who are being laid off at Blizzard. (Blizzard employees receive twice yearly bonuses based on how the company performed financially.) “There’s no way to make this transition easy for impacted employees, but we are doing what we can to support our colleagues,” Brack wrote.
The news follows months of rumors about layoffs at the publisher, which heated up early last week as word began to spread that hundreds of people across Activision Blizzard’s various divisions might lose their jobs. Leading up to today, some of the publisher’s employees had been coming to work with no clue as to what might happen. One person at Blizzard told me this morning that as employees arrived, they cried and exchanged hugs in the parking lot.
Last fall, Kotaku reported that Blizzard’s 2018 mandate had been to cut costs and produce more games, and that as a result, layoffs would likely hit the company’s support departments even as Blizzard continues to expand its development teams. Brack’s email suggests the same. “It’s critical that we prioritize product development and grow the capacity of the teams doing this work to best serve our player community,” he wrote. “We also need to evolve operationally to provide the best support for new and existing products.”
Meanwhile, in a press release to investors this afternoon, Activision CEO Bobby Kotick wrote: “While our financial results for 2018 were the best in our history, we didn’t realize our full potential. To help us reach our full potential, we have made a number of important leadership changes. These changes should enable us to achieve the many opportunities our industry affords us, especially with our powerful owned franchises, our strong commercial capabilities, our direct digital connections to hundreds of millions of players, and our extraordinarily talented employees.”
Staff at the game publisher Activision-Blizzard are preparing for big layoffs next week, waiting to see who will be one of potentially hundreds of employees who could lose their jobs on Tuesday.
There’s been no official news from the publisher yet, but we first heard word of upcoming layoffs late last year. At the time, Activision and Blizzard staff told me they expected the axe to fall in February, and I started hearing more and more rumors earlier this week, with whispers suggesting that the layoffs would happen ahead of the publisher’s quarterly earnings call, which is on Tuesday, February 12. Employees across all of Activision’s offices have been kept in the dark as they wait to see what will happen. Some say they’re pretty sure they’re safe; others say they fear they will no longer have jobs next week.
Last night, Bloomberg reported that the layoffs would take place on Tuesday and number in the hundreds. When contacted earlier this week by Kotaku about the upcoming layoffs, a spokesperson for Activision did not respond to requests for comment. A spokesperson for Blizzard declined to comment (twice).
This news comes after a tumultuous year for the publisher, which consists of two entities, Activision and Blizzard. Both Activision and Blizzard operate autonomously but are governed by the same C-suite of executives, including CEO Bobby Kotick (whose salary in 2017 was roughly $28.6 million).
At Blizzard, 2018 was a year full of cost-cutting, under chief operating officer Armin Zerza, whose mandate has been to reduce spending and produce more games. (Other than expansions and remasters, Blizzard has not released a new game since Overwatch in May 2016.) Employees all across Blizzard have been told to cut their budgets and spend less money, and there’s general concern about Activision’s creeping influence as the company looks to make more financially-driven decisions. In October, Blizzard CEO Mike Morhaime stepped down, to be replaced by Blizzard veteran J. Allen Brack—not as CEO, but, notably, as president. In December, Blizzard abruptly killed the Heroes of the Storm esports program and cut down the development team for that game, its least successful.
People who work or have worked at Blizzard told me that they expect Tuesday’s layoffs to be primarily in non-game-development departments, such as publishing, marketing, and sales. Some of those jobs and roles may then fall to Activision proper, further reducing Blizzard’s autonomy.
Activision, meanwhile, has also been struggling. Last year’s Call of Duty: Black Ops 4 was successful, one of 2018’s best-selling games according to NPD data, but the publisher lost one of its major franchises after Destiny 2‘s Forsaken expansion failed to meet Activision’s lofty expectations. In January, developer Bungie announced that it was parting ways with Activision and ending its development contract early, putting the bow on a long-doomed relationship. Bungie would hang onto the Destiny franchise as a result.
The business angle is that Activision is now missing one of its biggest tentpoles, but the human angle is that the split leaves people in danger of losing their jobs. Activision employed an entire team full of Destiny support staff—PR, marketing, social media, business, and so on—who now have no work. Two people close to the company told me that there have been a few opportunities for those former Destiny staff to move to other teams, but those opportunities are limited, and members of that department are perhaps the most worried about their job security.
The layoffs will likely happen on Monday and Tuesday. For now, those who might be affected can do nothing but wait.