Activision History: From Atari Rebels to Microsoft Acquisition

In 1979, four Atari programmers responsible for roughly 60 percent of the company’s cartridge sales asked for royalties and credit, and were told they were no more important than towel designers. That insult led David Crane, Larry Kaplan, Alan Miller, and Bob Whitehead to found Activision with venture capitalist Jim Levy, inventing the third-party game developer in the process. This corporate biography traces the company from that spiteful garage startup through near death, a hostile takeover for $500,000, and an $18.9 billion merger with Blizzard, all the way to its 2023 acquisition by Microsoft.

We examine how Activision’s lawsuit settlement with Atari legitimized software as a product separate from hardware, how the company’s own success helped trigger the 1983 crash, and the disastrous Mediagenic rebrand into business software. Then we follow Bobby Kotick’s resurrection strategy of converting creditor debt into stock, a shopping spree that landed Tony Hawk’s Pro Skater, Call of Duty, and Guitar Hero, the pursuit of World of Warcraft’s subscription revenue, and the recent unionization of 600 QA workers at a company that was founded by mistreated developers.

  • The Gang of Four, the $20 million memo, and why Atari refused to credit its programmers
  • Colorful boxes, mail-in high score patches, and Pitfall: how Activision built brand loyalty before the internet
  • The 1983 crash, the fall to 95 employees, the Infocom acquisition, and the identity crisis of the Mediagenic era
  • Kotick’s bankruptcy restructuring, the $5 million Infinity Ward purchase, and 25 studio acquisitions between 1997 and 2008
  • Ceding majority control to Vivendi for Blizzard, the Call of Duty factory years, Microsoft’s takeover, and the SAG-AFTRA AI strike

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