Runner-Up: Mike Morhaime

Mike Morhaime" made possible the biggest 2007 deal involving an Orange County company.

Irvine's Blizzard Entertainment Inc., which Morhaime cofounded and runs as chief executive, was the driving force behind's Vivendi's $19 billion December deal to buy Activision Inc.

France's Vivendi plans to combine Blizzard with Santa Monica-based Activision and end up with a 68% stake in the business, dubbed Activision Blizzard.

The move is set to make Activision Blizzard the biggest video game developer with yearly sales of $4 billion, propelling it ahead of longtime industry kingpin Electronic Arts Inc.

Morhaime is slated to continue running Blizzard, which makes games played over the Internet by millions worldwide.

He'll report to Robert Kotick, Activision's longtime chief executive, who's set to head Activision Blizzard from Santa Monica.

Had Morhaime ended up running the combined company from Irvine, he stood to be the Business Journal's businessperson of the year for 2007.

He earned the runner-up nod by building Blizzard into a video game powerhouse, which allowed Vivendi to go after Activision.

"It's a huge deal from Blizzard's point of view," said David Cole, analyst at DFC Intelligence, a video game market researcher in San Diego. "Blizzard is the driving format for Vivendi Games as a whole and is one of the largest publishers in the world."

Morhaime's year also included a move to larger space in the Irvine Spectrum, a handful of acquisitions and induction into the Academy of Interactive Arts and Sciences.

He's one of the founders of Blizzard. Morhaime helped start the business in 1991 along with developers Allen Adham and Frank Pearce under the name Silicon & Synapse.

The company changed its name to Blizzard in the 1990s and later was bought by New Jersey's Cendant Corp.

In 1998, Cendant, reeling from an accounting scandal, sold its games business to Havas SA, which at one point was France's largest game maker. Vivendi acquired Havas in 1998.

That brought Blizzard into Vivendi's games unit, which was a money loser at the time.

Back then. Blizzard had a small niche in the game industry, which focused on video game consoles that hook to TVs as well as handheld game players.

A boom in online video games led by Blizzard helped turn around Vivendi Games.

The unit went from a $251 million loss in 2004 to a profit of $51 million in 2005. In 2006 it saw about $1 billion in profits.

For 2007, Blizzard is expected to do $1.1 billion in revenue and with an operating profit of $520 million.

Blizzard has the highest profit margins in the industry, according to Vivendi, at around 40%.

Its cash cow is the "World of Warcraft" series, a game where millions of players face off over me Internet. The game has more than 9 million subscribers and has been translated into a dozen languages. "World of Warcraft" is a role-playing game for computers where players take on a character who goes on adventures, completes quests, acquires wealth, sleeps, fights and dies.

The games have spawned a movie and hundreds of fan Web sites.

Activision is a good match for Blizzard, Morhaime said in a recent interview with game and movie tracker IGN Entertainment Inc.

"We found that we shared a lot of the same values," he said. "We feel pretty comfortable with the Activision executives and feel like they're going to continue being supportive of the way that Blizzard Entertainment runs its business."

Activision, which got its start in 1989, has yearly sales of $2.5 billion.

Its best-selling games include the "Guitar Hero" series and games that feature professional skateboarder Tony Hawk, among others.

After the deal closes, Morhaime is set to keep doing what he does best at Blizzard-managing a close cadre of creative design artists and software developers. He'll have final say over Blizzard games, according to Vivendi.

The biggest challenge is going to be blending the two companies into a single, cohesive brand, according to industry watchers.

"There's going to be a lot of discussion about what the brand strategy will be," Morhaime told IGN. "On the Blizzard Entertainment side, it's very clear that the branding strategy is what it's always been-it will remain unchanged."

Copyright CBJ, L. P. Dec 31, 2007-Jan 6, 2008
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