How Vivendi Games Was Saved By World of Warcraft
Below is a MRR and PLR article in category Computers Technology -> subcategory Games.
How Vivendi Games Was Rescued by World of Warcraft
Summary
Once a struggling division for the French media giant Vivendi, its video game unit has turned into one of the industry's most profitable sectors, thanks to one game: World of Warcraft.
Article
Vivendi's video game division, formerly a financial drain on the French media conglomerate, has become a powerhouse of profitability, largely because of World of Warcraft.
Since its launch in 2004, World of Warcraft has attracted over 10 million users. According to Rene Penisson, President of Vivendi Games, the game has not only created a new market for the company but has also transformed the entire industry. "A great market is opening," Penisson told Reuters in an interview following the group's annual results presentation. "It's changing how people play video games."
Vivendi's French competitor, Infogrames?"owner of Atari in the United States?"recently stated that online games would drive industry growth, predicting they will account for a quarter of all games in three years. World of Warcraft invites users into a virtual world teeming with druids, goblins, and fairies, where they can form friendships, rivalries, and sometimes even find real-life connections. Last year, the expansion pack "The Burning Crusade" exceeded sales expectations, and Vivendi anticipates similar success with the upcoming "Wrath of the Lich King."
From 2003 to 2007, Vivendi Games doubled its revenue to over €1 billion ($1.52 billion) and turned a €200 million operational loss into a €181 million profit. "World of Warcraft has been the crucial factor transforming Vivendi Games," said Penisson. Without such a popular title, Vivendi would not have attracted the interest of Activision, the company behind hits like "Guitar Hero," with which Vivendi recently formed an $18 billion partnership. Depending on stock offerings, Vivendi Games will hold between 52% and 68% of the merged company, Activision Blizzard.
For 2009, Vivendi Games projected a combined revenue of $4.3 billion and an operational profit of $1.1 billion. Penisson will serve as the director of the new company. "The merger of the two companies creates a formidable group with a strong portfolio of products and development potential," he remarked.
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