Linux activision software

EXECUTIVE SUMMARY

THE largest firms in L.A. County software development are among the biggest players nationwide in the electronic games business.

Vivendi-Universal Games again tops the list of largest developers--with more than twice the number of local employees than its closest competitor. Activision, No. 2, and THQ, at No. 4, are joined by Encore Inc. in representing game makers on the list.

Activision saw the largest gain in employment in the last year, increasing its staff to 532 in L.A. from 277 reported in 2001.

As a whole, the software sector of the 200 largest public companies in L.A. is down 15 percent over the last 52 weeks, 14 percent year-to-date.

Activision's archrival, THQ, has seen its shares drop after a rapid run-up--they're down 35 percent over the last 52 weeks. Activision has held onto its gains, adding 16.2 percent in the same period.

The broad decline in share prices has been reflected in the leveling off of sector employment, which has flattened at just less than 8,000 in LA. County.

THE PACESETTER

VIVENDI-UNIVERSAL GAMES

THROUGH merger, acquisition and control of a number of lucrative licenses, Vivendi-Universal Games has been the biggest player in L.A. software for several years.

The business has been in a state of chum for some time. Dating back to the formation of Davidson & Associates in L.A. in 1982, it had lives as Havas Interactive and, with Vivendi's merger with Universal, Vivendi-Universal Interactive Publishing.

It has in the last year trimmed some operations, either selling or shutting down its non-games software development operations, and changed its name to Vivendi-Universal Games.

Luc Vanhal, its president and chief executive, said the name change "is a better reflection of what we are doing.

"The trimming of product lines was not related to the name change," he said. With the move of productivity software to the Internet, Vanhal said, the decision was made to focus on "better ways to do business."

More changes may be in the offing.

With the ouster of Vivendi-Universal Chairman and Chief Executive Jean-Marie Messier, the company's new chief executive, Jean-Rene Fourtou, has moved to cut debt by selling units. The company has said it would sell some French publishing businesses as well as its Houghton Muffin publishing unit in the U.S.

So far, Vanhal said, it's "business as usual. Internally, there is no talk of these things. We're having the biggest quarter in our history."

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