Activision Blizzard ($ATVI) is in the midst of a crisis, much like the NBA, over how it's positioning itself in relation to the Hong Kong protests. Companies are now being put in positions to publicly decide if they stand in solidarity with free speech and human rights, or to continue to accept money from companies related to an oppressive government. It seems, as of right now, western corporations are choosing the latter over the former.
Long-time publisher and developer Blizzard has had a head-spinning week, mired by a whirlwind of controversy over how it dealt with a Hearthstone streamer and dogged by a tornado of negative reactions to its stance on China. Chinese holding company Tencent ($HK:700) owns 5% of Activision Blizzard, and that fraction of influence is apparently enough to toss its player base, eSports community, employees, and fans all under the bus.
So how is it affecting the bottom line? We won't know until the dust settles, it's too soon for such an analysis. But we can look at the alternative data and see that this course of action is not going well for Blizzard.
For the uninitiated, Hearthstone is a digital collectible card game, or CCG, that is set in the World of Warcraft universe. It had three spikes in viewership data this year. The first was due to the April 9 release of the Rise of Shadows expansion, the second was during the World Championships at the end of April, and the third was around August 6 when the Saviors of Uldum expansion dropped.
A new expansion, card release, and seasonal event entitled the Doom in the Tomb came out the same day as the story breaking on Blizzard's bans. But this time, there was no spike in viewership.
The game has been out since 2014, and over the past few years, the numbers have sagged. When we zoom out on the Twitch data to Year-over-Quarter, October 2019 is the lowest it's ever been. It's a decline of 73% since April of this year when the yearly rotation happened and a 79% since April of last year's rotation.
On Facebook, Blizzard has seen its "talking about" count and total number of likes go down. People are actively unliking a once-beloved gaming brand and champion of players. Those days may now be over under the Activision and Tencent umbrellas if things don't change before the annual Blizzcon convention in early November.
And on Twitter, you can see people are both anticipating new Blizzcon announcements, and are anxious to see what Blizzard says about this whole Hong Kong fiasco. Or maybe they're following just to reply to Blizzard that they're canceling their Battle Net accounts, which is a popular trend on Reddit this week.
The irony in all of this is that Epic Games ($PRIVATE:EPICGAMES), which Tencent owns a 40% stake in, announced the total opposite of Blizzard in how it's choosing to handle free speech. So you can have your cake and eat it too, it turns out. It's amazing what you can achieve as a business once you grow a conscious and a spine.
About the Data:
Thinknum tracks companies using information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.
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