Activision Publishing, Inc. is an American video game publisher located in Santa Monica, California. It manages the publishing work for its parent company, Activision Blizzard, and includes several subsidiary studios. Activision is one of the largest third-party video game publishers in the world and was the top United States publisher in 2016.

The company was founded as Activision, Inc. on October 1, 1979, in Sunnyvale, California. It was started by former Atari, Inc. programmers who worked on the Atari Video Computer System (later called the Atari 2600). These programmers left Atari because they were unhappy with how they were treated. Activision became the first independent, third-party, console video game developer.

The video game crash of 1983, partly caused by many new companies trying to copy Activision’s methods without the same experience, hurt Activision’s position in console games. This forced the company to expand into games for home computers, including buying Infocom. After a change in leadership, with CEO Jim Levy replaced by Bruce Davis, the company renamed itself Mediagenic and expanded into business software. Mediagenic soon went into debt and was bought for about $500,000 by Bobby Kotick and a small group of investors in 1991.

Kotick reorganized the company to reduce debt by laying off most workers, moving the company to Los Angeles, and changing the name back to Activision. Using existing resources, the Kotick-led Activision focused on publishing opportunities. After recovering financially, the company acquired many studios and intellectual property during the 1990s and 2000s, including the Call of Duty and Guitar Hero series. A holding company was created as Activision’s parent company to manage both its own and acquired studios.

In 2008, this holding company merged with Vivendi Games (the parent company of Blizzard Entertainment) to form Activision Blizzard, with Kotick as its CEO. Within this structure, Activision oversees many third-party studios and publishes all games except those made by Blizzard. In October 2023, Microsoft acquired Activision Blizzard’s parent company, stating the company would continue to operate as a separate business. While part of Microsoft Gaming, Activision continues to publish games developed by its studios.

History

In 1976, Warner Communications purchased Atari, Inc. from Nolan Bushnell. This helped speed up the release of the Atari Video Computer System (Atari VCS), later known as the Atari 2600, by 1977. That same year, Atari started hiring programmers to create games for the system. Before Warner’s purchase, Atari did not give bonus pay or public credit to programmers who worked on profitable games. This was done to stop programmers from being hired by competing companies. Warner Communications had a different management style than Bushnell. Developer John Dunn said Warner treated developers like engineers instead of creative workers, which caused conflicts. Ray Kassar became Atari’s CEO in 1978 after Warner’s purchase. He focused on keeping production costs low for Warner.

In early 1979, Atari’s marketing team shared a memo listing the best-selling game cartridges from the previous year to help guide game ideas. David Crane noted that the games he was fully responsible for had earned the company over $20 million, but he still only earned a $20,000 salary. Out of 35 developers, four programmers—Crane, Larry Kaplan, Alan Miller, and Bob Whitehead—had created games that made up 60% of Atari’s sales.

Crane, Kaplan, Miller, and Whitehead became upset about not being recognized and were called the “Gang of Four.” They met with Kassar in May 1979 to ask for better treatment, such as royalties and credit on game boxes. Kassar, who had worked in a textile company before joining Atari, called the four men “towel designers” and said “anybody can do a cartridge.”

The four decided to leave Atari and start their own business but were unsure how to proceed. In 1979, third-party developers (companies that made games for other companies’ consoles) did not exist. Most games were made only by the companies that made the consoles. The four decided to create their own game development company. Their lawyer connected them with Jim Levy, who was raising money for software businesses for early home computers. Levy supported their plan and helped them get about $1 million in funding from Sutter Hill Ventures. They also planned to develop games for the Atari VCS and included legal costs in their funding.

By August 1979, Crane and Miller had left Atari, followed by Whitehead shortly after. Kaplan also quit in August but initially refused to join the new company. He later returned to join Activision in December 1979. Activision was officially founded on October 1, 1979, with Levy as CEO. The company was first called “Computer Arts, Inc.” but later renamed “Activision” by combining the words “active” and “television.”

Activision began working from Crane’s garage in late 1979. Each programmer made their own game, planned for release in mid-1980: Dragster, Fishing Derby, Checkers, and Boxing. Their knowledge of the Atari 2600 and special software tricks helped their games look different from Atari’s. Activision’s game boxes were brightly colored and showed in-game screenshots on the back cover. Instruction manuals for games credited the developers on at least one page. For most games until 1983, manuals also included instructions for sending high score photos to receive patches.

Before releasing their first games, Activision got a booth at the 1980 Consumer Electronics Show to showcase their titles. This earned them positive press, which worried Atari. Atari had already lost key developers and tried to harm Activision’s reputation by calling them “evil” in industry reports. Later, Atari threatened to stop selling games to stores that sold Activision titles. By the end of 1980, Atari sued Activision, claiming the four had stolen trade secrets and broken non-disclosure agreements. The lawsuit was settled in 1982, with Activision agreeing to pay royalties to Atari but proving that third-party developers could exist.

After their first games, each founder made their own titles, about once a year, for the first few years. While their 1980 games were modest successes, one of their first major hits was Kaboom!, released in 1981. This was Activision’s first game to sell over a million units. Their most famous game was Pitfall!, created by Crane in 1982, which sold over four million copies. Near the end of 1982, Kaplan left Activision to work on the Amiga personal computer.

By June 1983, Activision’s sales were estimated at $157 million, with $60 million in revenue. The company had about 60 employees and went public on the NASDAQ with the stock ticker AVSN. Activision’s success, along with the popularity of the Atari 2600, led to more third-party developers and other home consoles. Activision made games for the Intellivision and ColecoVision consoles, among others. However, many new third-party companies lacked experience and produced low-quality games, contributing to the video game crash of 1983.

Activision survived the crash but faced challenges. Many third-party companies went out of business, leaving unsold games that retailers sold at steep discounts. This hurt Activision’s sales, as consumers chose cheaper titles over their games. Quarterly revenue dropped from $50 million in mid-1983 to $6–7 million by late 1984. Activision had to lay off staff, reducing employees from about 400 to 95. To avoid going out of business, Activision expanded into home computers like the Commodore 64, Apple, and Atari 8-bit systems. Talent left the company through 1985, with Miller and Whitehead forming Accolade in 1984 due to falling stock prices.

Studios

• Activision Shanghai Studio in Shanghai, China; founded in 2009.
• Beenox in Québec City, Canada; founded in May 2000, acquired on May 25, 2005.
• Demonware in Dublin, Ireland; founded in 2003, acquired in May 2007.
• Digital Legends Entertainment in Barcelona, Spain; founded in May 2001, acquired on October 28, 2021.
• Elsewhere Entertainment in Warsaw, Poland; founded on May 16, 2024.
• High Moon Studios in Carlsbad, California, US; founded as Sammy Entertainment in April 2001, acquired by Vivendi Games in January 2006.
• Infinity Ward in Woodland Hills, Los Angeles, California, US; founded in 2002, acquired in October 2003.
• Raven Software in Madison, Wisconsin, US; founded in 1990, acquired in 1997.
• Sledgehammer Games in Foster City, California, US; founded on July 21, 2009.
• Solid State Studios in Santa Monica, California, US; founded in 2021.
• Treyarch in Playa Vista, Los Angeles, California, US; founded in 1996, acquired in 2001.

• 7 Studios in Los Angeles, US; founded in 1999, acquired in April 2009, closed in February 2011.
• Activision Value Publishing in Minneapolis, US; founded in 2000 as a merger of Activision subsidiaries Head Games Publishing, Expert Software, and Elsinore Studio. Closed in 2016.
• Beachhead Studio in Santa Monica, California, US; founded in February 2011.
• Bizarre Creations in Liverpool, England; founded as Raising Hell Productions in 1987 and changed name in 1994, acquired on September 26, 2007, closed on February 18, 2011.
• Budcat Creations in Iowa City, Iowa, US; founded in September 2000, acquired on November 10, 2008, closed in November 2010.
• FreeStyleGames in Leamington Spa, England; founded in 2002, acquired on September 12, 2008, sold to Ubisoft on January 18, 2017, subsequently renamed Ubisoft Leamington.
• Gray Matter Studios in Los Angeles, US; founded in the 1990s as Xatrix Entertainment, acquired in January 2002, merged into Treyarch in 2005.
• Infocom in Cambridge, Massachusetts, US; founded on June 22, 1979,

Awards

In 2003, the company received the Game Developers Choice "First Penguin" award for being the first third-party developer.