Without Hearthstone's success, Activision's King buy may not have happened

Until this week’s $6 billion purchase of Candy Crush creator King, Activision Blizzard had taken a cautious wait-and-see approach when it came to investing heavily into mobile games.

Until Monday's $6 billion purchase of Candy Crush creator King, Activision Blizzard had taken a cautious wait-and-see approach when it came to heavy external investments into mobile games.

But when it saw the success of Blizzard’s mobile-based card game Hearthstone: Heroes of Warcraft, the company thought harder about making that big move.

Asked in an earnings call if the success of Hearthstone had an influence on how Activision viewed the mobile opportunity, Activision Blizzard CEO Bobby Kotick replied, "Certainly, Hearthstone’s success, which has been extraordinary, was a catalyst for us to think about [mobile] opportunities differently.

"And when you look at 196 countries being served by King’s footprint and a network of over 400 million players, and our intellectual property that goes back to 1980, we thought there was a great opportunity."

Kotick said mobile games are a $36 billion market that’s growing fast.

In May this year, Blizzard said Hearthstone had 30 million players.

But one of the biggest questions is whether or not King can expand its already-massive network through the creation of new games and franchises. Currently, King is heavily reliant on the success of the Candy Crush franchise, and concerns consistently emerge about the diversification of King’s portfolio.

Riccardo Zacconi, who will remain CEO of King after the Activision acquisition is complete, assured analysts and shareholders that more games are in the pipeline.

"We are working on all the key franchises we have, with sequels and sister titles, and by the end of 2016, there will be at least three new titles coming out," he said in the earnings call. "Of course at the same time, our people are working on new things. So the target over time is to [create] new franchises."

King is getting into the resource management genre, and planning to release a “mid-core” game to target new audiences.

Kotick stressed, "The most important thing we see [in the acquisition], creatively, are sustained franchises that will have perpetual value, and we’ll continuously put our best creative foot forward."

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