Activision Blizzard Inc intends to spend $500 million developing and promoting "Destiny," potentially breaking industry records as it seeks to build the sci-fi role-playing videogame into its next multibillion-dollar franchise.
CEO Bobby Kotick revealed the number, which dwarfs Hollywood spending on some of its biggest firms, during the Milken conference in Los Angeles last week. A company spokesperson said on Monday the number was accurate but also included marketing, packaging, infrastructure support, royalties and other costs.
Activision, eyeing the flagging growth of its long-running "Call of Duty" action-shooter franchise, is eager to lay the foundation for its next multi-game blockbuster series.
Investors hope that "Destiny," scheduled for release on September 9 from Bungie, the same studio that created Microsoft's best-selling "Halo" franchise, could re-invigorate Activision's revenue, which slid 6 percent in 2013.
The company signed a 10-year contract with Bungie in 2010 that gives it worldwide distribution rights and significant control over the potential franchise's development.
"If you're making a $500 million bet you can't take that chance with someone else's IP," Activision CEO told the Milken conference. "The stakes for us are getting bigger."
Analysts said $500 million would likely be a record spent on a single game - especially one without an established track record. To break even, Activision would have to sell about 15 million to 16 million units of a $60 game, analysts said.