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Activision CEO rebukes Warner Music exec

By Tom Magrino, GameSpotPosted Aug 15, 2008 3:04 pm PT

Following record company's call for more royalties, Kotick says comments were not "respectful of how much we've done to bring new audiences into the market."

As the third-largest record company in the world, Warner Music is used to getting its way when it comes to matters of licensing its music. It would seem, then, that Warner CEO Edgar Bronfman's comments last week expressing dissatisfaction over the amount paid to the music industry by game companies licensing songs for use in the nouveau rhythm genre would spell an imminent hike in prices.

Of course, when the largest company in Bronfman's crosshairs also happens to be allied with the world's biggest record label (Vivendi-owned Universal Music Group), it isn't quite a one-sided debate. Speaking with the Financial Times today, Activision Blizzard chief Bobby Kotick responded to Bronfman's calls for higher compensation, saying they were not "respectful of how much we've done to bring new audiences into the market."

"I think his view was...that [Warner Music] should be compensated the way they might for a performance on iTunes," Kotick told the FT. "But this is an entirely different business that is very technically complex...We're introducing a whole new group of artists to new audiences that is resulting in their iTunes downloads being exponentially higher than they would otherwise be, [as well as] new album sales and new merchandising opportunities."

Reversing the tables to emphasize the growing importance of the Guitar Hero brand to the music industry, Kotick continued, "We're going to favor those publishers that recognize and appreciate how much we can add value to their artists."

French media conglomerate Vivendi SA merged its games group with Guitar Hero makers Activision in July, simultaneously creating the world's largest third-party publisher and bringing such best-selling franchises as World of Warcraft, Call of Duty, Diablo, and Tony Hawk under one roof. Vivendi SA also owns in whole the world's largest music company, Universal Music Group, which counts among its represented artists such acts as The Rolling Stones, Guns N' Roses, Def Leppard, and Robert Plant of Led Zepplin fame, to name but a few.

77 Comments

  • division_9

    Posted Oct 22, 2008 7:26 am PT

    Because of GH Aerosmith im never touching another GH again.

  • killzone_gamer

    Posted Aug 22, 2008 4:32 pm PT

    That would make Rock Band a Guitar Hero rip off.

  • -cyninja3-

    Posted Aug 19, 2008 12:09 pm PT

    This game is going to be a rock band rip off.

  • WardCleaver02

    Posted Aug 18, 2008 6:56 pm PT

    Dr Corndog-Thank you for bringing logic to this issue.

  • Franke_51

    Posted Aug 18, 2008 5:14 pm PT

    I would happily agree to saying screw you warner, but they have the license to AC/DC and i wanna see that stuff on guitar hero so this sucks...

  • Dr_Corndog

    Posted Aug 18, 2008 10:04 am PT

    Hvac0120: This isn't a legal issue. The game companies had to agree to pay royalties to use this music, and they're paying. What Warner did last week, after the contracts had already been signed, was to whine that the game companies "should" pay them more.

    The fact that both parties agreed to pay less, however, is proof that the amount that "should" have been paid is exactly what was paid. If Warner had had a legitimate claim to more money, they would have made use of it before striking the deal. Edgar Bronfman apparently hopes that whoever reads his comments is too ignorant of basic economics to realize that.

  • Dr_Corndog

    Posted Aug 18, 2008 9:58 am PT

    Considering that you still have to play full price for a track download on Rock Band or Guitar Hero even if you've already bought the song on the album or iTunes, and that the downloaded video game track won't play on your iPod, forcing you to buy the mp3 version of the song if you just want to listen to it...yeah, I'd say someone in the music industry is getting plenty of our money.

  • Hvac0120

    Posted Aug 18, 2008 8:56 am PT

    I don't think this rebuttal will hold up in court. Yes, the games are resulting in additional sales in the form of iTunes downloads and CD sales. However, just because you make a company more money, doesn't mean that the content owner is not still entitled to the profits from YOUR product. So, in my opinion Warner Music has a point and should win. It's not like I want the prices to go up on the DLC. I just don't think that the Guitar Hero owners have much support for why they won't pay up. This is going to end bad for the consumer in the end...

  • necronaux

    Posted Aug 18, 2008 8:29 am PT

    They should be thankful they're making money, instead of demanding a bigger share of the profits. But, no. No matter what happens, in the end WE are going to be paying even more for our games and our music.

  • rabbids

    Posted Aug 18, 2008 5:42 am PT

    Does it really mattr at this point?

  • Lucavi_Zalera

    Posted Aug 18, 2008 12:59 am PT

    I know I'm being simple minded, but who gives a s*** about anything the music industry says these days? Plus, if the music industry demands more money it would mean that low budget games, like Katamari Damacy, might just disappear, and that makes me a sad panda.

  • Mush_Mouth

    Posted Aug 17, 2008 9:04 pm PT

    Warner's just angry because the majority of their artists have left for better record deals with Live Nation. Just about all they have left at this point are Red Hot Chili Peppers and I'm sure it's a matter of time before they leave, too.

  • Atarii

    Posted Aug 17, 2008 7:05 pm PT

    I understand both sides in this arguement, but in the end I honestly don't care.

  • Atarii

    Posted Aug 17, 2008 7:05 pm PT

    I understand both sides in this arguement, but in the end I honestly don't care.

  • tawagivercetti

    Posted Aug 17, 2008 6:51 pm PT

    play nice boys

  • spears2k

    Posted Aug 17, 2008 6:02 pm PT

    The comments made by Universal are right on. Rather than Warner coming out and demanding more payment for their music being in GH, it should be record companies seeing what they can do to get their music into the latest installment. There's some music that I've heard in GH that I wouldn't have heard otherwise. Plus, I just think that the folks that make games like GH and Rock Band are just geniuses. Providing a way to connect with huge hits on a level other than just hearing them is just awesome.

  • azafirster

    Posted Aug 17, 2008 5:46 pm PT

    Money, money, money. Man, when it comes to profit, people couldn't care even if your promoting the music itself. Smart music execs Warner.

  • FrankenLife

    Posted Aug 17, 2008 1:42 pm PT

    This is what I was hoping would happen. I Warner wants to try to gold dig for reasons of greed, then GH should leave them be. let them know that making decisions like that will result in a loss for Warner.

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