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Activision and Vivendi Merge


What’s next, a level 70 Les Paul of Azzinoth?

Websites, message boards, media outlets, and level 70 palladins are all buzzing with the news of a surprising development in the video game industry: Vivendi and Activision have agreed to merge as part of an $18.9 billion deal.

Vivendi, the company that puts out the Warcraft and Starcraft series (including the MMORPG and mind control device, World of Warcraft), is offering Vivendi Games, valued at $8.1 billion and $1.7 billion in cash, in exchange for a 52% stake in Activision, the company that puts out the Guitar Hero, Call of Duty, Half Life, Tony Hawk, Quake, and Spiderman series. The two gaming companies will combine into one entity, Activision Blizzard.

Now Activision Blizzard will challenge Electronic Arts for the title of world’s largest video game publisher. Activision’s website sums up the merger, confidently stating that their new position will create “the world’s largest, most profitable pure-play video game publisher with some of the most popular titles in the industry.” Perhaps a new company motto is in store: “All your free time are belong to us. w00t!”

But what are the bigger implications?

The companies are assuring their customers that nothing will change with their existing games and services, but certainly the union will produce some great new games to compete with EA.

The merger can be seen as another sign of the times: new media companies are becoming more successful much faster than traditional media. When these new media companies merge to become media giants, they become even harder for traditional media to dismiss.