Microsoft’s Activision Blizzard Acquisition Won’t Save the Games Industry

Microsoft’s $68.7 billion acquisition of Activision Blizzard will make things worse for game workers — and entrench some of the most dystopian trends in video games.

On January 18, 2022, Microsoft announced it will be acquiring Activision Blizzard. This deal — struck for a record-setting $68.7 billion — will give Microsoft control of some of the most popular gaming franchises in the world. (Sean Do / Unsplash)

In 1995, Microsoft produced a truly bizarre pitch video for the press and the gaming public. Opening with footage from Doom, id Software’s iconic first-person shooter, the camera pulls back from the violence to reveal that it’s not Doom’s lone space marine gunning down possessed soldiers, but instead Microsoft’s chairman Bill Gates, who has been digitally inserted into Doom through the magic of blue screen. Wearing an ill-fitting black trench coat and wielding a shotgun, Gates speaks in a halting, flat monotone: “These games are getting really realistic. Next year I might even play in the big Doom tournament.” The video ends with a peal of ominous laughter and the question, “Who do you want to execute today?”

The video was made to promote Windows 95 as a gaming platform, but the real message from Gates seems to be, “I can take control of the games you play.” It took on new resonance when Microsoft announced in 2020 that it was acquiring id Software and several other game studios belonging to ZeniMax Media. Microsoft now owns Doom.

Microsoft has always been a highly defensive player in the games industry, making moves to avoid being dislodged from its monopoly position in the tech economy by upstart rivals. When Bill Gates inserted himself into Doom, he was doing it at a time when Doom was installed on more personal computers than Windows 95. The original Xbox video game console was developed over concerns that Sony’s PlayStation would conquer the living room and turn people away from Windows PCs. In both instances, Microsoft was able to secure a crucial circuit of capital for itself. Through Windows 95’s DirectX technology, Microsoft was able to create and enforce a set of convenient technical standards for graphics and sound cards, consolidating its hold on the majority of the computer gaming market. With the Xbox, Microsoft gave itself a foothold in the “console wars” and the future of online play through its Xbox Live subscription service.

Over the decades, Microsoft’s bid to consolidate more of the games industry for itself has only intensified. On January 18, 2022, Microsoft announced it will be acquiring Activision Blizzard. This deal — struck for a record-setting $68.7 billion — will give Microsoft control of some of the most popular gaming franchises in the world: StarCraft, Warcraft, Diablo, Call of Duty, and Candy Crush.

This acquisition is good for Microsoft, which will now be the third-largest firm in games behind Sony and Tencent. But it’s bad for game workers at Activision Blizzard, who are fighting for their rights at a company that is synonymous with workplace abuse in the games industry.

In its press release, Microsoft touts that it will “bring the joy and community of gaming to everyone, across every device.” Microsoft is framing the deal as ushering in a new era of community and convenience, when it actually represents control — control of technology, of audiences, of market share, and most importantly, control over workers.

Undermining Worker Power

The acquisition comes at a time of significant turmoil for the games industry’s second-largest publisher. Activision Blizzard is currently facing a lawsuit from the California Department of Fair Employment and Housing (DFEH) and a Securities and Exchange Commission (SEC) investigation, for presiding over a systemic culture of sexual harassment, abuse, discrimination, and retaliation against female employees. The range of abuses is truly monstrous in its scope. The DFEH lawsuit describes a disturbing “frat boy” culture where female employees at Activision Blizzard and its subsidiaries were regularly subjected to groping and unwanted sexual advances at work and professional events by their male coworkers, often with the encouragement of work supervisors. Complaints to HR were ignored or led to significant retaliation against the complainants.

Despite Activision Blizzard CEO Bobby Kotick professing ignorance about these events, a Wall Street Journal report in November confirmed that Kotick knew about the widespread misconduct at Activision Blizzard and did nothing. In fact, Kotick himself once issued a death threat against a female assistant in 2006. These events have led to walkouts, strikes, and the formation of collective workers’ group the ABK Workers Alliance, and has also seen the attempted unionization of quality assurance (QA) workers at subsidiary Raven Software.

While current Microsoft CEO Satya Nadella praises Kotick for his “commitment to real culture change,” Activision Blizzard continues to do everything it can to put a stop to growing worker power within the company. Activision Blizzard refuses to recognize Raven Software’s QA union, Game Workers Alliance, and has also demanded that all 300 employees at Raven should have a say in whether or not the studio should be unionized, a clear union-busting tactic. Game workers at Activision Blizzard have already filed a complaint with the National Labor Relations Board (NLRB) due to threats, intimidation, and discipline employees have received for publicly discussing and organizing against the company’s abusive practices.

Recently, Activision Blizzard’s VP of quality assurance posted a message in the company’s Slack channel criticizing ongoing unionization efforts, stating that “a union doesn’t do anything to produce world-class games, and the bargaining process is not typically quick, often reduces flexibility, and can be adversarial and lead to negative publicity.” Shockingly, Bobby Kotick has been allowed to remain CEO of Activision Blizzard until the acquisition closes in 2023 despite being at the center of Activision Blizzard’s abusive work culture.

Microsoft’s own history of poor labor practices should indicate that the tech giant will not be receptive to organizing efforts at Activision Blizzard. In December, Microsoft launched Halo Infinite, the latest installment in its flagship first-person-shooter franchise, but the development and launch of the game was anything but smooth. A report from Bloomberg on the game’s troubled development details the problems created by an overreliance on contract labor and a Microsoft policy that prevents contractors from working for more than eighteen months. Bug testers on contract to Microsoft saw their jobs terminated after they successfully unionized in 2014.

When asked about ongoing unionization efforts at Activision, Microsoft’s CEO of gaming, Phil Spencer, declined to give any specific comment, saying he wasn’t an expert on unions. It is galling but unsurprising that amid some of the worst abuses in a famously abusive industry, efforts by workers to establish real accountability and protection for themselves continue to be undermined.

Enter the Micro-verse

In an interview with the Washington Post’s Gene Park, Spencer outlines the real priorities of Microsoft’s acquisition: “I was looking at the IP list, I mean let’s go!” He struck a very different tone last November, when he criticized the “horrific events and actions” at Activision Blizzard and stated that Microsoft would be reevaluating its relationship with the company. Most people probably did not suspect that reevaluating its relationship meant fully absorbing the troubled publisher. But as Activision Blizzard’s share price plummeted amid multiple scandals, it appears that Microsoft saw its most significant opportunity to stake a claim in the tech world’s latest fad — “the metaverse” — ahead of its competitors.

The metaverse has become the tech industry’s go-to buzzword for the next “iteration” of the internet, a nebulously defined conceptual space of avatars, virtual worlds, and virtual reality in which to work, play, and shop. Although sold as a utopian vision of freedom and social connection, what it really means is doubling down on the creation of proprietary platforms with “value-added” services. One of the big promises of the metaverse is “interoperability” — the idea being that if you buy a cool, customizable costume in one proprietary virtual space, your avatar be able to wear it in another. Microsoft’s recent run of acquisitions from Mojang Studios (creators of Minecraft) to ZeniMax to Activision Blizzard reveal what this will look like in practice. There may very well be some kind of “interoperability” of purchased game items but only within the walled garden of your chosen video game monopoly.

The metaverse being built by Facebook, Microsoft, and other big tech firms should be seen as an intensification of what Nick Srnicek calls “platform capitalism,” a term highlighting how digital platforms and the users (and data) they aggregate have become central actors, and resources, in many high- and middle-income capitalist economies. Under platform capitalism, creating and maintaining audiences that can be mined for data and future profit is of the utmost importance. Microsoft’s Game Pass, a “Netflix for games” subscription service that allows players to download and play hundreds of games for a monthly fee, already boasts 25 million users, and Microsoft is looking to bolster these numbers before competitors like Sony begin to roll out their own versions. The 400 million monthly users that Activision Blizzard attracts to its most popular games are just as important to Microsoft as their intellectual property rights.

The focus on keeping audiences engaged so that they may be tempted to purchase cosmetics and other micro-commodities exerts further pressure on workers. Games are no longer discrete experiences, but now “live services” that must be continually updated. Issues like “crunch,” which sees game workers forced into punishing amounts of unpaid overtime, are exacerbated by the need to maintain the recursive consumption of free-to-play online games. This means 60-plus hour workweeks, no sleep, and burnout.

To win the game, the workers must defeat the bosses. The ABK Workers Alliance continues to organize and fight on. The Communications Workers of America (CWA) helped organize Raven Software’s QA union and have called for a further investigation of Activision Blizzard for misleading investors after it claimed to the SEC recently that it did not know of any labor issues. Raven Software’s QA union is also filing for an election with the NLRB, even as Activision Blizzard tries to stifle it by assigning members of the QA team to other studios. Only when game workers can fully exercise collective power will the bosses of Microsoft and Activision Blizzard be truly doomed.