Back in January, we received the surprising, but somehow not-all-that-shocking news that Bungie would be breaking away from their partnership with Activision and taking the Destiny franchise with them. There was wild speculation about why the split had occurred but it wasn’t until Activision’s recent earnings call (where we learned that the company would be laying off 800 employees despite posting a “record year” for profits) that we got confirmation.
Activision Blizzard President and Chief Operating Officer Coddy Johnson said that the publisher not owning the rights to the Destiny IP was a big factor in deciding to part ways. “We did not own the underlying Destiny IP, and we do for all of our other major franchises, which we think is not just a differentiator for us in the industry,” he said. “But also controlling the underlying IP gives us the chance to move in with new experiences and new engagement models which also come with new revenue streams and, structurally, higher economics when you own the IP.”
Of course, that wasn’t the only reason given. As many suspected based on Activision’s comments shortly after the launch of the Forsaken expansion, Destiny was not meeting the financial expectations of the publisher. “Destiny is highly critically acclaimed, high quality content, but it was not meeting our financial expectations,” Johnson said. A review of 2019’s finances showed that Destiny 2 would not be a “material contributor” to profits and the decision was made to let them go. When Activision originally commented on the expansion not meeting expectations, Bungie retorted by saying that they were not at all disappointed with Forsaken or the work they had done on the franchise.
If that’s not enough, Activision also cited their studios that had been “tied up” making content for Destiny. Both High Moon Studios and Vicarious Visions had assisted Bungie with bringing additional content to the game at a faster clip than they could handle themselves. With Activision not happy with the financial performance of the game, they saw these studios as hamstrung by a game that wasn’t making them the profit they wanted. “[Bungie was] tying up one of our scarcest resources: developer talent,” Johnson said. Both studios will continue to work with Bungie on Destiny 2 during a transition period while they finish any projects that are currently in development. Afterwards, they will be moved to other Activision products.
We also learned more about just how quickly the deal to part ways happened. Activision Blizzard became aware in November 2018 that Bungie wanted out of its publishing deal with the company. A deal was reached in late December before being announced to the surprise of many in January.
The decision to split up was described as mutual and amicable, and Johnson thinks it’s the best decision for both companies. “Bungie gets to focus on the [Destiny IP] that they have created and we get to focus on our biggest opportunities on our biggest franchises with our best resources,” he said. “Our decision was reached with mutual agreement with Bungie to sell back the commercial rights. And for us at least, it was rooted in really our strategy overall.”
Destiny fans, myself included, have a lot of opinions surrounding the split and what it will mean for the future of Bungie and Destiny. There’s no denying that having a massive publisher backing a franchise has its benefits, but seeing Activision Blizzard’s recent layoffs just might prove that Bungie and Destiny narrowly dodged a bullet.
Activision Bungie Split Was Because Destiny Wasn't Meeting Expectations