With hits like Assassin’s Creed, Raving Rabbids, and Tom Clancy’s Rainbow Six, Ubisoft has become one of the world’s biggest video game makers with nearly $1.7 billion in annual revenue. But sometimes, success comes with a price.
For the better part of the past two years, the company has had to deal with a looming takeover threat from French media conglomerate Vivendi, which has slowly been buying shares of the game publisher. As of mid-August, it held a 27% stake.
CEO Yves Guillemot has made it clear that Ubisoft has no interest in Vivendi’s involvement, and he is working to shore up shareholder support against a takeover. At the same time, he has shepherded the release of a remarkable string of hit titles, helping the company’s stock hit all-time highs.
We sat down with Guillemot to see where things stand in the face-off with Vivendi, how Ubisoft is dealing with the fast-paced changes in the gaming industry, and why including players in the game-making process is more important than ever.
FORTUNE: Do you expect this year to be the final showdown with Vivendi? That company has indicated it’s planning to accelerate acquisitions in the video game industry, which may put you in the crosshairs.
Guillemot: What we feel is that they are financial guys. Our best defense has been to perform. When you perform, you can show your shareholders that it’s better for them to stick with the team that’s managing the company instead of going to another. What we’ve seen is that our shareholders are very happy with the direction we’re taking, so it gives Vivendi less space to do a creeping control [a takeover accomplished by gradually acquiring the target company’s shares]. It’s still a risk, but doing a creeping control in a company that is growing and is appreciated by the people who invest in it is more difficult than doing it to a company that is not performing well.
You’re involved with e-sports, a.k.a. televised competitive video game tournaments, but I don’t hear Ubisoft talk about it as much as some other game publishers. How big a priority is that for you?
It is a huge priority, but we need to make sure our games are ready for it. So, for example, with Rainbow Six: Siege, we waited a little bit at the beginning so it was more stable [unlikely to crash]. Recently, we said, “Okay, we can go full speed.”
What’s the benefit for you? What do you get out of being in the e-sports community?
The advantage is that those competitions are watched a lot. The more people who are watching your game, the more people will understand how to play it well. It’s marketing. It’s a way to teach people how to play. Also, many people want to play games that can give them a chance to shine. E-sports is a good way to shine.
Every publisher is looking for ways to adapt to a changing landscape, where it’s increasingly important to keep people playing for longer stretches of time. How do you boost player engagement in Ubisoft titles?
Players are really looking at how they can play more of what they love at a reasonable price. So publishers are adapting to that. An open-world game [titles like Watch Dogs or the upcoming Far Cry 5 that let players move freely through a virtual world and either follow the story line or explore side stories] is a way to say, “Okay, I get in and can do things the way I want. So it won’t be a 20-hour game, it can be a 40-hour game.” That’s a good way for the players to express themselves and play longer.
You’re asking game players to contribute their thoughts much earlier in the design process with upcoming games like Beyond Good and Evil 2 and Skull & Bones. Do you expect that to continue?
You will see more and more of that in Ubisoft games. But we choose the game development team first—and that team’s vision. Then we make sure they get information from the community. It’s important that they’re influenced by the community, but really stay true to their vision, because the more you follow influences from everybody, the less you have something that’s different.
How critical do you think artificial intelligence is to the future of game design?
The big deal for the industry is really A.I. We have to master it a lot better than we do today. I’m convinced that being better at using data to influence games and make them alive and more dependent on people’s playing behavior [for example, players who tend to be more aggressive in shooter games would face off against more enemies] is something that will be one of the things that changes the industry.
A version of this article appears in the Sept. 1, 2017 issue of Fortune.
