2010

Blizzard Entertainment Inc

Vasileios Mantzoukas 1/30/2010

Contents

1.

Company Overview

1.1.

History of the company

1.2.

Markets Products Competitors

1.3.

Technologies Capabilities

2. Innovative and Design activities

2.1.

R&D

2.2.

Innovation Strategy

3.

Key Challenges and Opportunities

4. References

1. Company Overview 1.1 History of the company

Blizzard entertainment is an American video game developer and publisher which was established in February 1991 by Michael Morhaime, Allen Adham and Frank Pearce (All three of them are graduates of UCLA).The original name of the company was Silicon & Synapse and was served as a third-party developer, creating entertainment software for various platforms, including MS-DOS, Macintosh, Sega Genesis, and Super NES. It was in 1993 when the company developed its first games like Rock N' Roll Racing and The Lost Vikings. In 1994 it changed its name to Chaos studios and was renamed again to Blizzard Entertainment Inc. The same year Blizzard was acquired by Davidson & Associates in a very low price of 10 million dollars. In 1996 Blizzard acquired Condor Games a company working for them on Diablo, a game which became a great hit. Condor Games was renamed to Blizzard North and was located in San Mateo, California. The same year CUC International acquired Davidson & Associates along with Sierra-on-line and then merged with a hotel, real estate and car-rental franchiser called HFS Corporation to form Cendant. In January 1997 Blizzard launched their online gaming service Battle.net. It became extremely popular among gamers and a major selling point for Diablo and subsequent Blizzard games. External interfaces used by other online services did not incorporate into the games which made use of them. Battle.nets success came from the fact that it was the first online service that had this feature along with ease of account creation and the absence of member fees. Since the successful launch of Battle.net, many companies have published online game services mimicking Blizzard's service package and the user interface. Nowadays its active users count is over 13 million and continues to rise.

In 1998 the consumer software operations of Cendant were sold to French Publisher Havas. The same year Vivendi SA successfully acquired Havas and Blizzard became a part of the Vivendi games group in which, till now, continues to operate autonomously. In 2004 Blizzard opened European offices (Blizzard Europe) in Yvelines, France which were responsible for the upcoming release of its first MMO-RPG game called World of Warcraft in Europe. In addition, recently, a new organisation was created by Blizzard in Korea (Blizzard Korea) for the exact same reason. Swingin' Ape Studios, a company responsible for the creation of StarCraft: Ghost (console game), was acquired by Blizzard in 2005. Nowadays Blizzard headquarters are located in Irvine, California along with Blizzard North. Year after year it continued producing new games keeping quality and its customer exceptionally satisfied. All the games they have developed till now are bigsellers and in 2008, Blizzard was honoured at the 59th Annual Technology & Engineering Emmy Awards for the creation of World of Warcraft where Mike Morhaime, the president and co-founder of Blizzard, accepted the award. Its dedication to creativity and its huge profits, derived from its continuous successful products, helped its growth. Nowadays it has approximately 3000 people working for it. It had acquired a new building in Irvine, California which has 240,000 square feet and provides 65 percent more space than the previous facilities. It has dozens of meeting rooms and an executive board room and in reality its a big change referring to the meeting room the company used to work to. BlizzCon and Blizzard Worldwide Invitational are the events that Blizzard offers in order to meet players and to announce games. Finally, in July 2008 Vivendi Games merged with Activision, using Blizzard's name in the resulting company, Activision Blizzard.

1.2 Markets Products Competitors

Blizzard is a key company in the game industry. It mainly targets younger ages as its customers but the history had shown us that it has a big fun club of older people over the age of 35. In addition, it has a global reach as it sells in almost every continent (North America, Latin America, Europe, Korea, Australia, New Zealand, Singapore, Malaysia, and Thailand, and the regions of Taiwan, Hong Kong, and Macau). All games developed till now are compatible with the two most known operating systems, Windows and Mac. There are thoughts of willing to develop games that are cross-platformed which means that they can be played by a PC and a console but this implementation needs coordination and cooperation with the console designers/manufacturers in order to be achieved. Furthermore, Blizzards games mainly belong in three major categories: 1) 2) 3) RTS (Real-time strategy) RPG(Role playing game) MMORPG(Massively multiplayer online Role playing games)

A list of all the games developed by Blizzard (name, date, description): RPM Racing 1991 racing game

Battle Chess 1992 chess Battle Chess II: Chinese Chess 1992 Xiangqi J.R.R. Tolkien's the Lord of the Rings 1992 role-playing game Castles 1992 strategy MicroLeague Baseball 1992 sport Lexi-Cross 1992 game show Dvorak on Typing 1992 education The Lost Vikings 1992 platform game Rock N' Roll Racing 1993 racing game Shanghai II: Dragon's Eye 1994 mah-jong solitaire Blackthorne 1994 cinematic platform game The Death and Return of Superman 1994 side-scrolling beat 'em up Warcraft: Orcs & Humans 1994 fantasy real-time strategy game The Lost Vikings II 1995 platform game Justice League Task Force 1995 fighting game Warcraft II: Tides of Darkness 1995 fantasy real-time strategy game Warcraft II: Beyond the Dark Portal 1996 expansion pack Diablo 1996 action-oriented fantasy role-playing game StarCraft 1998 science fiction real-time strategy game StarCraft: Brood War 1998 expansion pack Warcraft II: Battle.net Edition 1999 fantasy real-time strategy game Diablo II 2000 action-oriented fantasy role-playing game Diablo II: Lord of Destruction 2001 expansion pack Warcraft III: Reign of Chaos 2002 fantasy real-time strategy game Warcraft III: The Frozen Throne 2003 expansion pack World of Warcraft 2004 MMORPG set in the Warcraft universe. World of Warcraft: The Burning Crusade 2007 expansion pack World of Warcraft: Wrath of the Lich King 2008 expansion pack

StarCraft II: Wings of Liberty (under development) science fiction real-time strategy game World of Warcraft: Cataclysm (under development) expansion pack

Diablo III (under development) action-oriented fantasy role-playing game StarCraft II: Heart of the Swarm (under development) expansion pack StarCraft: Ghost (indefinitely postponed) third-person shooter

Its games sell millions of copies even within the first 24 hours. Moreover, the company has earned several consecutive Game of the year awards and each new release always breaks the companys previous selling record. The key competitor for Blizzard is NCsoft Corporation which has dominated the South Korea's online gaming market. NCsoft had tried several times in the past to launch an MMORPG, like Guild wars or AION in order to persuade some of Blizzards MMORPG (World of Warcraft) gamers to abandon it and start playing its games. Every attempt was unsuccessful and Blizzard continues to dominate the online gaming market. Finally, there are several other small companies developing games in any of Blizzards major categories but cannot be measured as worthy competitors for the time being.

1.3 Technologies Capabilities

Blizzard has always been a company of producing high-quality games. The programming languages, the developers of the company use, are mainly C++ and C#. All games come out in two versions, one for Windows and one for MAC. The Xcode which is Apple's premiere development environment is utilized by the Blizzards Macintosh developers in order to create each game compatible for MAC PCs. Moreover, it is known that Blizzard has always created its own graphic engines which gave it the opportunity to create remarkable and unique implementations in each game. In addition, the modelling, animation, rendering, and visual effects for each of its products are implemented with the help of Mudbox, ZBrush, Photoshop and Maya applications. In 2006 Blizzard licensed Havok 4.0 which is a platform providing the developers with the necessary tools in order to optimize the game-play physics and animations. It becomes obvious that the core capability of the company is its technological expertise. Every developer hired by the company has an excellent background on understanding how a game is developed and how each tool, provided in the open market, works. Blizzards unbelievable success of its two first games gave the company an incredible momentum and confidence in their business strategies. Its brand image went up and stayed there till now. This is a result of the continuous successful releases of its games and its dedication to deliver, this way, value to the consumer. Allen Adham once said that Blizzard is a game company, staffed only by gamers and managed at all levels by gamers and as a result of that all their strategic decisions are made through the eyes of gamers. The best way to understand their consumer base was to actually be part of the consumer base rather than trying to anticipate the needs and desires of consumers.

2. Innovative and Design activities 2.1 R&D

Blizzard internally develops and publishes PC-based computer games and maintains its proprietary online-game related service, Battle.net. Blizzards business involves the development, marketing, sales and support of role playing action and strategy games. It also develops, hosts, and supports its online subscription-based games in the MMORPG category. The Blizzard research and development group comprises more than 250 designers, producers, programmers, artists, and sound engineers. The organisational structure of R&D is decentralized. The company has specific teams working on individual projects. These way employees have the chance to specialize and focus on their tasks and optimize their productivity. Every employee is free to choose how he will implement any of the requirements for each project and may also affect the features of the final product. In reality Blizzard, by selecting only gamers as its employees, almost exclusively, rely on their ideas for any of the new products it decides to start its development. It asks them what they want to make next and it does not care about what the marketing or business development says. It encourages them to embrace their interests and passion and also allows them to arrange or decorate their individual space with anything that reflects their taste. Employees are recognized with unique gifts such as a sword after five years, and a shield at ten. In addition, Blizzard provides the Battle.net Forums for its customers to chat, exchange ideas and strategies, and submit feedback. This way the company engage indirectly with the needs and interests of its customer. Every day hundreds of gamers post new ideas and petitions in Battle.net forums while there are always assigned personnel on Blizzards behalf to read and respond to them. The combination of having gamers as employees who supply the company with fresh ideas and the feedback it gets from Battle.net forums are the key factors for the decision-making process on what will be the next game to be developed. Finally, companys employees formally provide a pre-release feedback through a process called alpha test and the final implementations are done simultaneously with the players feedback through the beta test which allows lead users (players/gamers) to play the game and reveal any unidentified errors or bugs.

2.2 Innovation Strategy

Blizzard is characterized as an offensive innovator. Each product, it has launched, is full of new features for the user to explore and till now all of them have received a warm welcome. Blizzard was never first in creating a new category on PC games but it managed to improve them all in such a degree that in reality each game almost represents a category on its own. It utilizes its personnel and customers opinion and combines them with the new ideas rose and the understanding of mistakes made by its competitors in order to perfect the game-play experience. Furthermore, it does not make improvements only for its games but as mentioned above Battle.net was the first online gaming service which gave the user the capability to explore certain features of the game just by connecting to the online service.

Blizzard has always been a company producing games that are easy to learn but hard to master. This principle, that has been followed by the company since the beginning of its establishment, gives the freedom to all gamers around the world to enjoy playing its games either they are casual gamers or hardcore ones. Simplicity and high quality are the two main characteristics for all game interfaces hence gamers easily adjust to the requirements and demands of the game. Blizzard has always the long-term view on everything. It hurts the brand image of the company if a game is released on time and does not reflect the actual presumable result. The company does not take any risk in investing in short-term benefits where there are substantial possibilities of gaining much more in the long term. The firm protects its innovations using lots of patents for all of its products. Last year it filed a patent for something called Battlechat which will be used for future thoughts of developing applications for mobile phones. This year, it filed a patent for the word Cataclysm which will be included in the title of its MM0RPG expansion pack.

3. Key challenges and opportunities

Blizzards only challenge is not to overestimate its own importance and achievements but continue exploiting its great ideas. It should always monitor its competitors and keep learning by their mistakes. A challenge thus an opportunity at the same time is to successfully expand its market towards the Console game industry. Finally, the development of mobile phone applications which will give the user the capability to stay connected with the companys game community seems like a great opportunity especially nowadays where the mobile phone industry is in full blossom.

4. References
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Doors Closed

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