Activision and Electronic Arts: The Brewing War

Every industry has its rivals: Two big companies duking it out for customer loyalty and king-of-the hill status.

In the cell phone world, it's AT&T vs. Verizon. In the computer world, it's Apple vs. Microsoft. Among video game companies, it's Electronic Arts vs. Activision Blizzard and it's about as ugly a fight as you've ever seen.

While the rhetoric gets shrill in any corporate battle, it has moved well past that in this fight, with high profile employees being wooed away and gamer loyalties being put to the test. Ultimately, though, it's shareholders that, for better or worse, could be caught in the middle.

The ripple effect from that could be felt for some time, as current Infinity Ward employees decide whether to join their old bosses or stay put. Already, four high-ranking developers have quit Infinity Ward. While none have officially joined Respawn Entertainment (West and Zampella's new studio), most industry observers expect they eventually will.

If it's the beginning of a greater exodus, that could have significant repercussions for Activision.

"All of this turmoil around Infinity Ward has certainly been a distraction, and if a significant portion of Infinity Ward's staff leaves for the new studio, it could impact Activision's 2011 release schedule," says Ben Schachter, an analyst with Broadpoint AmTech.

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