Mike Morhaime was not the primary leader of Blizzard Entertainment when he and his cohorts formed it (as Silicon & Synapse) 27 years ago. The company’s main instigator was Allen Adham, who was a big gamer and badgered his college friend Morhaime for a year to join him in making video games.
But Morhaime and cofounder Frank Pearce gave in to their more gregarious friend, and the company that became Blizzard opened its doors on February 8, 1991. Adham was a natural leader, while Morhaime was an engineer who enjoyed coding and playing games. Morhaime took over in 1998, after Adham resigned to pursue a different life. And since 2007, Morhaime was CEO of Blizzard.
Activision Blizzard announced on Wednesday that Morhaime was stepping down as president and was handing over his duties to J. Allen Brack, longtime steward of World of Warcraft and a 12-year veteran of Blizzard, which has some of the most devoted fans in gaming for titles including Overwatch and StarCraft. It’s a big changing of the guard at one of gaming’s most valuable companies, now valued at $63.3 billion. During the past year, Blizzard has seen successes such as the launch of its latest version of World of Warcraft and the debut of the Overwatch League esports competition.
“When Blizzard’s founder Allen Adham first invited me to join him in creating Silicon & Synapse (our original name), nothing could have prepared me for the amazing adventure that we would share for the next 27 years,” Morhaime said in his parting letter. “Our original mission and values consisted of four simple words that formed our foundation: ‘We make great games.’ We crafted that statement before we had even released our first game, but we were committed to living up to it.”
Through its games, Blizzard developed a unique position in the annals of gaming. It killed almost as many games as it published in a relentless focus on making quality games. The company promises to carry on its legacy as Morhaime steps into an advisory role.
“Today has been a swirl of emotions. First, I feel a deep sense of gratitude to Mike. His work on some of our industry’s most iconic games is the reason I came to Blizzard,” said J. Allen Brack, who is taking over as president of Blizzard. “Not only is he an inspiring leader, but he’s also been a wise and patient mentor to me during my time at Blizzard. And he’s been a good friend. Joining the World of Warcraft team and my favorite game company nearly 13 years ago was an unimaginable dream. Now, to be chosen to lead Blizzard into the future is both a huge honor and a tremendous responsibility.”
Adham instilled that sense of quality early on. In an interview for Blizzard’s 25th anniversary, Morhaime told me that Adham wouldn’t cave to different pressures to get a game done so it could be on a magazine cover or the company could keep to a schedule. That ethic was put to the test early on with The Lost Vikings, a game that Silicon & Synapse built for publisher Interplay. The team felt that the work on the game was pretty much done, and it had been sent over to Brian Fargo, Interplay’s chief.
Fargo made a lot of notes about the game, including feedback such as parts when the levels were too hard or the vikings looked too similar.
“My first reaction was ‘What? It’s fine the way it is,’” Morhaime recalled. “Allen had a very different attitude. He said, ‘He’s right. He’s right about all of this stuff. We took the time and addressed the issues.’”
Silicon & Synapse didn’t have the resources to fix the game, but Fargo freed up some money for the studio to go back to work on the fixes.
In an email, Fargo said on Wednesday, “I’ve known Mike since he was a kid, and his personality and attitude never changed despite the outrageous success that Blizzard had. He remained the same calm, fair and helpful person that I enjoyed working with in the early days. I was always impressed with his talent and him as a human being.”
“We wound up with a much, much better game,” Morhaime said. “Going through that process, and seeing where the game was before, and how much better it became with this additional effort, was a huge lesson to us. We got additional feedback from people who weren’t inside the development team, but knew how to make games. That was incredibly valuable. Addressing that feedback and going through an iterative process, especially toward the end of development, could really move the meter on quality. We have done that on every game since.”
The company would go on to publish nearly 30 games after that, but the focus on quality in The Lost Vikings was a formative moment for Blizzard and how it would approach the creation of games in the future.
That sense of taking pride in the work, meeting the highest quality expectations, and never shipping a game before it was ready was instilled within Blizzard early on, Morhaime said. And it became part of the glue that held the culture and the team together for so long, Morhaime said.
When I was at the Los Angeles Times, I interviewed Adham and Morhaime when the company was going by the name Chaos Studios. It was based in Costa Mesa, California, and it had just 19 employees at the time. They had done successful games for Interplay, and they were ready to move out on their own.
Silicon & Synapse was acquired for what, in hindsight, looks like a tiny amount of money. Davidson & Associates, an educational software company based nearby in Torrance, California, came calling. The company, which Bob and Jan Davidson started, acquired Chaos Studios in early 1994 for $6.75 million.
“Back then, it seemed like a lot,” Morhaime said.
Indeed, Adham was 27 at the time, and Morhaime was 26.
In 1996, CUC International, a mail-order club company, bought Davidson & Associates for $1.6 billion, and it also shelled out $1.5 billion to buy game publisher Sierra On-Line. Then CUC merged with HFS, and the company was renamed Cendant. By 1998, CUC got busted for accounting fraud, which took place years before the merger. Cendant stock lost 80 percent of its value over the next six months.
The game business was sold off in 1998 to French publisher Havas, which was owned by French media company Vivendi. Blizzard became part of the Vivendi Games group. Vivendi also acquired Universal, the movie company, in 2000. By that time, Blizzard had 200 employees.
Morhaime realized what sort of leadership path was the best for him to take, as the company became bigger and bigger. Blizzard stayed put under the same ownership structure until Vivendi Games merged with Activision in July 2008 in an $18.9 billion deal. That led to the creation of Activision Blizzard, with Blizzard Entertainment still operating independently with the larger company.
At that time, Blizzard had 2,600 employees. Since that time, Blizzard has been part of Activision Blizzard. Morhaime continued to run Blizzard independently, but he reported to Activision Blizzard CEO Bobby Kotick.
It was a crazy corporate history in terms of changes in ownership, but it resulted in one of gaming’s powerhouses. Activision Blizzard is valued at nearly twice the market value of its closest competitor, Electronic Arts, which is worth $35 billion.
Charles Huang, co-creator of the Guitar Hero game and former head of Red Octane, said, “He guided World of Warcraft to become the first video billion dollar game in the history of our industry. An incredible leader. He had the deepest combined knowledge of both game development and business I ever came across.”
In recent years, Morhaime stood out as a voice for reason and kindness. At a games industry gala, he thanked me for 25 years of game industry coverage. He engaged with fans through the company’s annual BlizzCon event and occasional speeches. During the height of the Gamergate controversy in 2014 and afterward, Morhaime advocated kindness to gamers and those who make games. And he closed his final message with a continuation of that message.
“When we started Blizzard, we just wanted to make great games. What we realized is that the games we create are really just a framework for communities and human interaction,” Morhaime wrote. “When we look back, what we often find that’s most lasting and meaningful from our experiences in games are the relationships we create and foster. You have given me the inspiration and drive to pour my heart and life into what I do. I literally couldn’t have done any of it without you. We have created these worlds, but you have given them life, through your passion, fan art, cosplay, videos, and in so many other ways.”
He added, “I truly believe that this amazing community has the potential to be a shining light to the rest of the industry by setting a positive example of inclusivity, tolerance, and acceptance toward others. In the words of one of Blizzard’s core values: remember to always play nice; play fair. I know this community is capable of changing the world.”
Blizzard itself, which is working on more games than ever before, is a fine legacy for Morhaime. And Blizzard founder Adham has returned to develop several new games, and he has joined the executive team.
“One thing that won’t change going forward — our deeply held commitments that are core to who we are as a company: to gameplay first, to quality in everything we do, and to listening to and partnering with our community,” Brack wrote. “BlizzCon, the IRL (in real life) representation of our connection with the community, is just a month away, and it’s a time of the year that Blizzard employees look forward to the most. And as usual, we have a few surprises.”