Blizzard 2008 Annual Report Download - page 17

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3
of software to third-party companies that distribute World of Warcraft in China and Taiwan.
During 2008, Blizzard released World of Warcraft: Wrath of the Lich King, the second expansion
pack of World of Warcraft. Blizzard is currently developing new games, including sequels to the
StarCraft and Diablo franchises.
Our distribution business consists of operations in Europe that provide warehousing,
logistical, and sales distribution services to third-party publishers of interactive entertainment
software, our own publishing operations, and manufacturers of interactive entertainment hardware.
Management’s Overview of Business Trends
Activision’s 2009 scheduled releases—We expect to launch games based on proven
franchises such as Call of Duty, Guitar Hero, Transformers, Wolverine, Marvel, Tony Hawk,
Wolfenstein, and Ice Age. Games scheduled for release during the quarter ended March 31, 2009
include Guitar Hero: Metallica for the Xbox 360, PS3, Wii in North America; Monsters vs. Aliens
worldwide on multiple platforms; approximately 50 downloadable songs for Guitar Hero; and the
first map pack for Call of Duty: World at War. The more notable games, among other titles,
scheduled for release during 2009 include: Marvel Ultimate Alliance 2; Wolverine, based on
XMen: Origins Wolverine, which is one of the most popular Marvel characters; Transformers:
Revenge of the Fallen; Prototype, an all new and third-person open-world action game; Ice Age 3;
DJ Hero, a new line extension of the Guitar Hero franchise; Call of Duty: Modern Warfare 2; a
new racing game developed by Bizarre Creations; a new game based on the Tony Hawk franchise;
an all new Wolfenstein; and our new wholly owned first-person action game called Singularity.
Console hardware platforms—In 2005, Microsoft released the Xbox 360 and, in 2006,
Sony and Nintendo introduced their respective hardware platforms, the PlayStation 3 and Wii.
Activision’s plan is to continue to build a significant presence on the PS3, Wii, and Xbox 360 by
expanding the number of titles released on these platforms and hand-held platforms while
continuing to market to the PS2 platform as long as it is economically attractive to do so given its
large installed base.
Business combination and investments—We have engaged in, evaluated, and expect to
continue to engage in and evaluate, a wide array of potential strategic transactions, including
acquisitions of companies, businesses, intellectual properties, and other assets. On July 9, 2008,
we consummated our Business Combination with Vivendi Games. Upon the closing of the
Business Combination, Activision, Inc. was renamed Activision Blizzard, Inc. As of
December 31, 2008, Vivendi owned approximately 55% of our common stock. Activision
Blizzard now conducts the combined business operations of Activision, Inc. and Vivendi Games
including Blizzard Entertainment, Inc. See also Note 1 of the Notes to Consolidated Financial
Statements included in this Annual Report.
To further strengthen our development resources and underscore our commitment as
leader in the music-based genre, on September 11, 2008, we acquired Freestyle Games, Ltd., a
premier United Kingdom-based video game developer specializing in the music-based genre.
Additionally, on November 10, 2008, we acquired Budcat Creations, LLC, an Iowa City, Iowa
based video game developer. Budcat Creations is an award-winning development studio with
expertise on the Wii and NDS.