Is the State of Blizzard Leak True? Is It Plausible?

Over the past couple of days, an unverified insider leak about the state of Blizzard has been making rounds in social media.

Now, fake leaks happen all the time, but even if this one is not true, it is quite interesting because it exhibits lots of symptoms that companies like Blizzard are likely to fall into and that Blizzard has fallen into based on other publicly available information.

I have played World of Warcraft and Hearthstone from launch and created Hearthstone content on Youtube and Twitch for almost six years. Therefore, I have followed Blizzard closely for quite some time. I have also worked in a Director level position on strategy, processes, organizational models, and pricing in a global company. Overall, the theory and practice of what the leak describes from Blizzard are familiar to me.

In this post, I want to take a deeper look at what the leak claims, how believable those claims are, and what they mean, if true.

After the initial hype, there has been a considerable amount of criticism regarding Shadowlands. Player numbers shot up at the start of the expansion, and then fell. Whether the situation is as dire as the leak claims, is difficult to verify. Furthermore, World of Warcraft has exhibited the pattern of increasing player numbers with new expansions followed by a fall for years by now.

What is interesting is the line about being too big to fail and if they build it, players will come. This is a common attitude in some of the biggest companies in the world. For example, when I was going through interview rounds for a position at one giant company, and we discussed their product portfolio, the employees just flat out told me that they will simply create the demand for whatever they make with their marketing machine. I have never been a fan of this belief, but it is something that is very commonplace in big companies.

It would not be out of place for Blizzard to not understand the appeal of Final Fantasy XIV, either. Blizzard maintains a very positive communications strategy and typically pushes major content releases to coincide with those of their competitors, trying to drown out any hype for competing products. This has worked for a long time, so not considering the competition that dangerous is an easy evaluation to make.

Regarding mobile game style retention traps, we have seen in both Hearthstone and World of Warcraft that Blizzard has indeed moved towards in-game design that attempts to keep people playing. The grind is real. Whether you’re happy playing the game is irrelevant, as long as you keep playing and keep rolling in those hours spent in the game. Hearthstone’s Rewards Track revamp that added to the number of quests you want to complete and Shadowlands’ quest and travel design that increased the time you spend doing essentially un-fun things are both clear examples of this.

The focus on getting people to sub to World of Warcraft for 6 months at a time has been clear for some time: pretty much every 6 months, people with the long sub get a free mount, something that has not been the case before. It seems like a sensible monetization strategy: for people just on the edge of unsubbing, the slightly cheaper 6-month subscription combined with some cosmetics might just be enough to keep them active instead of taking a break.

The monetization potential on mobile/tablet is undeniable, and a gaming company can easily be tempted to step into that. Blizzard has made some of the first moves – Don’t you guys have phones? – although from a strategic perspective one has to wonder whether such a traditional PC game company really should try to conquer mobile. I suppose Blizzard has some pretty good data on the subject and has deemed this more of a Blockbuster/Netflix moment for them than an unnecessary distraction from their core focus on PC games.

I have not followed Overwatch closely enough to say whether there is anything to the claim that it was killed by trying to make it more of an esport.

The comments about J. Allen Brack and Ion Hazzikostas being good people who are now in positions that are way over their heads is impossible to verify. It is difficult to see into the inner workings of a company, but as a phenomenon, over-promoting people is well known.

The culture where managerial positions are seen as inherently more valuable than designer positions is a major contributor to this, as getting to any managerial position is seen as advancement in a career, even though a star developer could be more valuable for the company. In traditional companies, sales has been the only part of the organization that has been exempt from this thinking, as commission-based salespeople have been able to out-earn even their CEOs.

The characterization of some attitudes at Blizzard as “positivity dojo” is hilariously accurate.

Blizzard, as a company, has long been allergic to any criticism and anything that is not unconditional praise, really. In Hearthstone, the community manager blacklists people who are not praising the company enough and major content creators have talked in interviews about how they are afraid of losing support if they are in any way negative.

This is a significant cultural issue at Blizzard, and one often associated with failing companies. It is always the culture that goes first. Hubris, a loop of false positivity, and silencing the doubters happens first, and financial losses come later. In various studies, companies have been found to make their record profits at a point when it’s all already going downhill, carried by the good deeds of the previous years. When that updraft ends, the fall can be steep.

I had the pleasure (?) to work some periods at Nokia and for its contractors, both during its good years and when its fall had started, and the culture was gone before the profits were in that case too. I think we are seeing plenty of similar signs at Blizzard.

The difficulty in hiring is hard to quantify, but it is easy to find plenty of people online saying that they would have loved to work at Blizzard once upon a time, but no longer feel that way. I’m part of that crowd myself; at the very least, I would no longer consider relocating just for Blizzard.

This is where it’s starting to get a little iffy. Celestalon (Nervig) has not stopped using Twitter – he last responded to me yesterday, as a matter of fact. Then again, the effects of any such instructions are difficult to assess from the outside.

The search for Blizzard’s direction in this final part is not something that can be easily verified.

Is the leak true?

There is nothing in the leak that could be used to immediately verify whether it is true. Future events cannot reliably show it either because even if Sylvanas were to become the Arbiter or Activision cracked down on Blizzard and turned it into a mobile company, neither would be definite proof.

The vast majority of things in the leak are publicly available information: the monetization strategy, the move to mobile, the mobile-game-like engagement metrics, none of that has been hidden in any way. Someone who has been following Blizzard closely for the past few years could put this together.

Then again, nothing in the leak is terribly off, either. Are these the real sentiments inside Blizzard? From the outside, we cannot know. Overall, however, the leak is neither outrageous nor overly negative, so it might as well be a real one.

What can we learn from the leak?

Blizzard is going through a rough time. The customer sentiment has turned in a dangerous direction for the company. You could put this together from other sources already, it is just conveniently compiled in the leak. The current state of the company would require crisis management, but the companies that need it often recognize that need only when things are almost impossible to correct. If I were into betting, I would not bet for Blizzard right now.